Wall Street Journal is reporting that Motorola will shut down its plant in Fort Worth, Texas, by the end of the year, with the reason being low sales and high costs.
Last year, Motorola opened the plant to manufacture the Moto X, touting it to be the device assembled in the US, despite the high costs of manufacturing in the region.
The company will soon come under the leadership of Lenovo who aims to turn the company around. Motorola makes some excellent handsets, with timely updates, even for the low-end devices such as the Moto G and Moto E.
WSJ says the company had a workforce of 3,800 employees during its peak time, which is now down to 700 employees, who are assembling the Moto X orders. Although most of them were under contract with Flextronics International Ltd.
“What we found was that the North American market was exceptionally tough,” Motorola President Rick Osterloh said in an interview to WSJ.
It makes sense actually, the manufacturing in the US is not very cheap, and the company is focusing on releasing low-end devices. The company’s Moto G costs $219, while the newly-announced Moto E comes with a $129 price tag. These handsets have received their fair share of success in developing regions such as India, so making them in the US may not make sense.