It's already in the news

Hello Anak,

Kumalat na ng husto ang pagsasara ng aming kompanya. Malaki kasing kawalan ito sa GDP ng Pilipinas - GDP contribution is at US$5B of the US$31B ng buong bansa. Yan ang mawawala sa ekonomiya ng Pilipinas kong mahal. :(

Narito ang isa sa mga naisapubliko na balita sa GMA Channel 7: http://www9.gmanews.tv/evideo/35216/1800-Pinoys-to-lose-jobs-when-Intel-shuts-down. Nasa ibaba naman ang nasa Business Mirror.

Nakakalungkot pero life goes on...

God bless us.
love, Tatay

Intel closing plant in Cavite
Written by Dennis D. Estopace and Max de Leon / Reporters
Thursday, 22 January 2009 22:30

AFTER months of keeping under wraps the inevitable, Intel Corp. has finally announced it will close its Philippine plant—with its 1,800 employees expected to be formally notified within two weeks that they will lose their jobs. The plant in Cavite is expected to be fully shuttered by April, sources said.
“They’ve been doing that, shedding off jobs even before the announcement of the closure,” a person very familiar with the operations of Intel Technology Philippines Inc. (ITPI), which has operated in the Philippines for 35 years, told the Business Mirror.
ITPI’s parent, Santa Clara, California-headquartered Intel Corp., announced the closure the day Filipinos celebrated the inauguration of Barack Obama as president of a country undergoing a deep economic recession. The recession has hit Intel so much it lowered profit forecast by more than 20 percent.
The closure of Intel, described as the world leader in silicon innovation and which develops “technologies, products and initiatives to continually advance how people work and live,” would cause some 1,800 Filipinos to lose their jobs.
The person familiar with ITPI operations told the BusinessMirror the plan last year was to see the last employee leaving by April.
“Now, that schedule has been forced earlier,” the source said in a phone interview.
Scanty details on RP wind-down
ITPI imposed a news blackout on Thursday as journalists tried to get details from the company.
“They are targeting that by the second quarter of this year, there wouldn’t be a trace Intel was even here,” the source said.
The source added the only persons left by April would be those who will demolish the buildings.
ITPI’s corporate affairs manager Arlita Narag, who replaced external relations manager Teresa L. Pacis, faxed this statement to the BusinessMirror.
“As announced by Intel Corporation today, the impact of the economic downturn on our business was more severe than we anticipated and the outlook is uncertain. As a result, we have decided to restructure some of our manufacturing operations by taking older capacity off line and closing five factories during the course of 2009. Included in this action will be the closure of two of our assembly test facilities in Penang, Malaysia; and the assemble test facility in Cavite. Two of our wafer fabrication facilities in the United States will also end production.
“Our manufacturing operations in Cavite will cease this year. Approximately 1,800 employees will be affected and will be offered a severance package and a range of transition services. We know this is a difficult time for our employees and their families and we will make available the best support systems to ease the transition…”
Pacis resigned from Intel December but was asked to extend her stay up to January 15. Last month, Pacis told Business Mirror that “talks are ongoing” about the fate of ITPI’s plant in the country—meaning, on whether the company would move from Cavite to Laguna province.
“We’ll be announcing details [of the plant transfer] by January,” external communications manager Pacis said before Christmas Day. She didn’t say the full operations would be shuttered.
“Severance pay packages have been offered,” the source said, adding these packages were “very competitive, very generous.”
However, the source said the parent company hasn’t offered to absorb its employees and transfer them to its other overseas location.
“What’s being offered is China but the pay scale would be based on local structures.”
Aside from the Philippines, Intel Corp. said it is also closing its assembly test facilities in Penang, Malaysia, and will halt production at an older wafer fabrication facility in Hillsboro, Oregon.
“Additionally, wafer production operations will end at the D2 facility in Santa Clara, California,” Intel said in a statement.
The world’s largest semiconductor manufacturer added that including the closure of ITPI, “the actions at the four sites, when combined with associated support functions, are expected to affect between 5,000 and 6,000 employees worldwide.”
Blow to employment
ITPI’s closure has made the Philippines lose one of its largest sources of employment and contributor to the economy. Based on a commissioned study four years ago, Intel’s total electronic product output was determined to be equivalent to 0.3 percent of the country’s gross domestic product.
The company also generates 36,000 jobs indirectly, in allied services and industries.
The company has also been active in supporting community development projects notable of which are supporting young student scientists and giving for free mini-laptop units to select schools.
Peza’s efforts in vain
Elmer San Pascual, group manager of the promotions and public relations division of the Philippine Economic Zone Authority (Peza), said the top brass of Intel had informed the government of the decision of the company’s mother office to close down its Philippine plant in Cavite.
San Pascual said the current American officials of Intel here were even accompanied by those who were already reassigned to other countries when they went to Peza Director General Lilia de Lima to deliver the sad news two days ago.
Months before, San Pascual said Peza tried its best to find a new site for Intel because the company was initially complaining of the “structural defects” in its Cavite facility, citing this as the basis for its inclination to shut it down.
Eventually, San Pascual said they found a suitable location for Intel at the Laguna Light Industry and Science Park and they thought the company was no longer leaving.
“We’ve been helping them for one year to find a new site and we thought all along that they are already okay with the one that we found in Laguna. But apparently, they are really affected by the crisis,” he said.
Intel’s decision to leave the Philippines, San Pascual said, would have a huge impact on the country’s exports because it is perennially in the list of the top two exporting companies in the country together with another American chip maker, Texas Instruments. This is aside from the thousands of workers it employs.
San Pascual said while Intel is out for now, there is still a big possibility that it would come back to the Philippines when the global situation improves.
He said there are companies that have decided to come back to the Philippines years after they left, one of which is phone manufacturer Uniden.
Seipi says ‘ouch!’
Even with the slump that it is currently experiencing, compounded by the decision of giant chip maker Intel to leave the Philippines, the Semiconductor and Electronics Industries of the Philippines Inc. (Seipi) remains optimistic. It views Intel as just another episode of the industry’s cyclical growth that always leads to another strong upturn eventually.
So even if “ouch!” was the first word that Seipi president Ernie Santiago could utter when asked what would be the impact of the departure of Intel, he remains upbeat because of the preparations they are doing now to meet what he described as a new upturn.
The industry has always been spiraling upward. This has been proven in the past so this should not stop us in doing the right things right now,” Santiago told the BusinessMirror He said the industry hit three slumps historically—the first in 1985, followed by 2001, and then the last quarter of 2008 to this year.
Both in 1985 and 2001, Santiago said the industry managed to fully recover the following year.
“So following the trend, by 2010 we would already be okay hopefully,” he said.
With this, Santiago said the industry is busy in its efforts to manage well the current downturn and then prepare for the eventual recovery.
For one, they are doing a lot of benchmarking and review of best practices, and carrying out training programs.
Santiago said Intel’s departure is something that is happening worldwide because of the crisis, so the effect on the image of the Philippines as a manufacturing and investment haven should not be too damaging.
“Any loss would be bad, but this is not something that is peculiar to the Philippines. It is happening globally,” Santiago said