Report: PlayBook production lines undergo reduction
Analysts recently predicted that Research in Motion’s PlayBook tablet could undergo liquidation in a manner similar to the HP TouchPad, and sadly the latest news isn't offering much reassurance to the Canadian manufacturer.
In light of decreased orders by ODMs, Quanta Computer has laid off 1,000 employees and reduced production lines in their Northern Taiwan facilities, according to a Digitimes report. While the world’s largest PC contract maker declined to comment on client specifics, reduced orders are believed to be the main reason and the PlayBook appears to be the biggest culprit.
According to the report, the Northern Taiwan production lines were specifically set up to produce the BlackBerry tablet, due to concern’s by RIM that Chinese factories would be more susceptible to imitations and knock-offs. RIM also estimated that 4-5 Million units would be sold in 2011 alone, but due to the device’s less than cheery acceptance, fewer than 800,000 devices actually shipped. Furthermore, in analysis done by The Guardian, 800,000 unsold PlayBooks may be present in RIM warehouses, and the stocks could constitute around 15% of the company’s inventory values.
Based on the preceding info, we can definitely see why Quanta would reduce their production lines and cutting their losses may have been the right move. However, the manufacturer did confirm that the laid-off workers were contractors rather than full-time employees, so there may just be a silver lining on the horizon.