Mon, Nov 05, 2012 - Page 13 News List

AUO confirms job cuts after losses

DISHEARTENING RESULTS:The nation’s second-largest LCD panel maker has posted disappointing results for the third quarter, resulting in losses for eight straight quarters

By Kevin Chen  /  Staff reporter

LCD panel maker AU Optronics Corp (友達光電) confirmed yesterday it is streamlining its operations by cutting nearly 100 jobs last week amid a corporate restructuring.

Hsinchu-based AUO said nearly 100 employees at the company’s Lungtan (龍潭) factory in Taoyuan County were laid off on Friday. The firings took effect immediately.

“The job cuts are part of our restructuring plan aimed at enhancing the company’s competitiveness,” AUO spokesperson Hsiao Ya-wen (蕭雅文) said by telephone yesterday, confirming a report by the Chinese-language Apple Daily earlier in the day.

Hsiao said the company announced in September a plan to restructure the group’s organization, focusing on its display and solar power divisions.

She said the layoffs announced on Friday were employees who the company found difficult to move into other jobs at the company. Therefore, AUO decided to hand out pink slips to these employees with a severance package better than that stipulated in the Labor Standards Act (勞動基準法), she added.

The firings represent less than 1 percent of AUO’s workforce in Taiwan, where the company has 18,000 employees.

When asked about how much the flat panel maker is expecting to save from the job cuts, Hsiao said the company had no estimate.

She said she also could not answer questions about whether the company will have further layoffs under the restructuring plan.

AUO is the nation’s second-largest LCD panel maker in terms of revenue after Chimei Innolux Corp (奇美電子).

The latest job cuts came as the company on Oct. 25 reported disappointing results for the third quarter of the year, resulting in huge losses for eight straight quarters.

In the July-to-September quarter, AUO posted a net loss of NT$16.48 billion (US$564 million), expanding from a net loss of NT$12.46 billion in the second quarter and a net loss of NT$15.8 billion for the same period last year, the company’s financial statement showed.

AUO said the widening losses for the third quarter were primarily due to an anti-trust payment for a price-fixing lawsuit in the US and increased losses from its solar power unit.

The company said its losses in the solar business rose from NT$2.1 billion in the second quarter to NT$2.8 billion in the third quarter, while its non-operating losses also climbed in the quarter, mainly due to recognition of an anti-trust penalty of NT$6.7 billion for a price-fixing lawsuit in the US.

Amid a weakening economy worldwide and a slower recover yin the global flat-panel industry, two of AUO’s local peers, Chimei and Chunghwa Picture Tubes Ltd (中華映管), have reportedly implemented hiring freezes on full-time employees to decrease personnel expenses, the Chinese-language Economic Daily News said on Oct. 26.

Reports that companies are asking their workers to take unpaid leave have increased since August, with the latest statistics compiled by the Council of Labor Affairs showing that 815 workers were furloughed in the past two weeks, pushing the total number of workers on furloughs to 2,855 so far this year.

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