Google Shuts Down Texas Smartphone Factory Due To Weak Demand

smartphoneGoogle’s plan to build smartphones in the United States is ending soon, as the company announced it will shut down its Texas factory.

Poor Consumer Demand

Google’s Motorola Mobility handset unit said the factory would close by the end of the year.

The move comes after the result of weak sales of Moto X smartphone, failing to gain consumers’ attention.

The facility, which Google plans to sell to Lenovo, opened in May 2013.

At its peak late last year, the factory employed as many as 3,800 employees. Today, it now employs about 700 people who assemble high-end Moto X smartphones.

Pressure On Economy

Google agreed to sell the Motorola handset business to Chinese PC maker Lenovo for $3 billion.

That agreement is expected to close later this year, according to the Motorola spokesperson.

Motorola said last year it would challenge perceptions that manufacturing in the US is costly.

Weak Moto X sales, however, meant the company could not achieve economies of scale.

Shinobu Abbiati
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Shinobu is an accountant in a local firm in New Jersey. He holds his own personal blog focused on business and finance.