Motorola Aims To Improve Supply Chain With Outsourcing

Motorola Inc. and Celestica Inc. have announced a strategic marketing alliance, under which Motorola will sell its manufacturing operations in Dublin, Ireland, and Mt. Pleasant, Iowa, to Celestica for US$70 million. Also, Motorola will outsource to Celestica the manufacture of some cellular-phone handsets, messaging devices, two-way radio products, and accessories. Motorola's Boynton Beach, Fla. plant now will concentrate on software applications, product design, and administrative support. Pager Care Center operations will transfer to Motorola's Ft. Worth facility, with manufacturing shifted to Celestica in Dublin. The $1-billion-plus, three-year alliance is the second major outsourcing agreement Motorola has announced this year -- part of a long-term strategy to improve supply-chain efficiencies, consolidate manufacturing, and improve financial performance. This latest agreement is expected to close in second-quarter 2001. The $33.1 billion Motorola, provider of integrated communications and embedded electronic solutions, is headquartered in Schaumburg, Ill. Celestica, a $5.3 billion electronics manufacturing services company, is headquartered in Toronto.