Fresh fears for 800 NEC jobs

The company is expected to announce a profits warning

The scale of the job losses at Japanese computer giant NEC's Livingston plant will be known next week, it has emerged.

The company has refused to confirm renewed reports that it plans to cut up to 800 jobs at its West Lothian plant.

The latest suggestions, which follow similar speculation earlier this month, came in a Japanese newspaper.

It said the move will be part of NEC's plans to cut semiconductor production at its domestic and overseas plants to cope with a prolonged slump in the global microchip market.

The plant produces memory chips for computing devices

NEC has refused to confirm the latest report or comment on the number of staff which could lose their jobs.

But it has emerged that the company will make an announcement to its Scottish workforce on Tuesday detailing the outcome of restructuring plans.

Livingston accounts for a fifth of the company's production of Dynamic Random Access Memory (D-RAM) chips, the microchips which power personal computers.

In the past year, the price of these chips has fallen from $15 to less than $2.

NEC had been planning to phase out D-RAM production over the next two to three years, but the slump in the global market could force it to act sooner.

Earnings damage

According to the reports in the Japanese newspaper, the company is expected to announce a profit warning on Friday.

It was suggested that NEC plans to cut the production of its D-RAM chips to prevent any further damage to earnings.

The move is expected to mean a 50% cut in production at its plant in Livingston, and the loss of half of its 1,600-strong workforce.

Fears for the plant first emerged more than two weeks ago when a Japanese newspaper predicted that the company would cut 800 jobs at Livingston.

We are calling for NEC to clarify the situation now regarding the future of the factory

Willie Dunn, West Lothian Council

At that time a spokesman said the company could not rule out cuts at its Scottish plant as the company restructured its business in Europe.

The plant's managing director, Hideto Goto, flew to Japan for talks over the future of the factory.

Danny Carrigan, Scottish regional secretary of the AEEU union, said the electronics industry was "reeling from one bad announcement to another".

"People are asking where this will end," he said.

"I am calling on Wendy Alexander (Scottish enterprise minister) to extend the remit of the Motorola taskforce to include the NEC Livingston plant.

"Something must be done to help and assist those workers who are going to be made redundant through no fault of their own."

West Lothian Council is demanding an early meeting with the company.

The Motorola plant in Bathgate is to close

Economic development spokesman Willie Dunn said: "We are calling for NEC to clarify the situation now regarding the future of the factory.

"If these reports turn out to be true, this is a devastating blow for the local economy and one which will need investment from the Scottish Executive."

An executive spokesman said: "We are working closely with the company.

"No decisions have been made and this is simply speculation."

The move would be a further blow for the electronics industry in Scotland, as West Lothian has already seen the loss of 3,000 jobs through the closure of the Motorola mobile phone plant in Bathgate.