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Last Updated: Friday, 17 March 2006, 07:15 GMT
PC maker Lenovo to cut 1,000 jobs
Lenovo employee shows off its new notebook computer
Lenovo says it needs to become more efficient
Lenovo, the Chinese computer maker which bought IBM's personal computer arm last year, is to cut 1,000 jobs.

The redundancies, accounting for about 5% of Lenovo's global workforce, will affect ex-IBM employees in the US and other staff in Europe and Asia.

Lenovo said the move would reduce "inefficiencies" across the business and save the firm $250m a year.

The company also plans to centralise production of desktop computers in China, in an effort to reduce costs.

Fierce competition

The reorganisation of Lenovo's 21,400-strong workforce will take place over the next year as the firm aims to reduce costs and become more competitive in a cut-throat market.

Lenovo said the restructuring would deliver a "cost structure that better reflects the realities of today's highly competitive, global PC industry".

William Amelio, Lenovo chief executive
It is clear that for the future of the company, we have to take these actions forward
William Amelio, Lenovo chief executive

About 350 jobs are to go at Raleigh, North Carolina, where IBM's PC business was formerly based.

The rest of the layoffs will take effect across Lenovo's other operations in the US and worldwide.

William Amelio, Lenovo's chief executive, said the restructuring would boost the firm's profitability and make its growth more sustainable.

"We have thoroughly examined Lenovo's competitive position and it is clear that for the future of the company, we have to take these actions forward," he said.

Lenovo entered the top tier of global PC manufacturers when it bought IBM's PC business for $1.25bn last year.

It recently announced plans to market Lenovo-branded PCs outside of China for the first time.

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