Motorola Mobility will be shuttering their Texas-based manufacturing plant by the end of 2014. In speaking with The Verge, Motorola President Rick Osterloh said that reason was their handsets weren’t selling enough to warrant keeping the factory open. It was also said that the North American market was a tough one to navigate.
When they purchased Motorola from Google earlier in the year, Lenovo discussed plans to turn the company around and make it a worthwhile acquisition. Despite warm receptions and reviews towards the Moto X, the Motorola wing continued to lose money for Lenovo. For manufacturing to continue stateside everything rested on the shoulders of Moto X to be a lifetime performance in the smartphone arena for Motorola.
While manufacturing will move overseas, Motorola will continue to offer their smartphone customization service Moto Maker. It has raised questions as to how this will actually work since the quick delivery element of the service is the main thing it stands on.
In the last three years Motorola Mobility has had a history of being purchased and passed about as companies try to figure what to do with it to make it profitable.
Google announced that it would purchase Motorola Mobility in late 2011 for $12.5 billion. In Google’s case, the purchase was merely to have access to the treasure trove of patents Motorola had. In early 2014, Lenovo and Google came to an agreement on the sale of Motorola for almost $3 billion—which includes $750 million in Lenovo shares.
The closing of the Texas factory will see around 700 employees left without work.
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