In just less than a year, Motorola is calling it quits on its Fort Worth, Texas factory – specifically to assemble custom-configured, high-end Moto X smartphones ordered via Moto Maker for US customers.
The facility, the only smartphone factory in the US, was opened in May last year and has around 700 employees now, though as many as 3,800 workers were employed late last year.
The Wall Street Journal reports that the plant will close its doors by this year end. The company confirmed that the closure will not affect the Moto X availability or the Moto Maker program, as the production will be moved to Brazil, China and other undisclosed locations.
“What we found was that the North American market was exceptionally tough,” Motorola President Rick Osterloh told the Journal.
The move comes just months after Google announced that it was selling the Motorola Mobility unit to Lenovo for $3 billion in a deal expected to close later this year. However, a Motorola spokesperson stressed that the decision to shut down the factory has nothing to do with the planned sale.
Texas Moto X factory reportedly had trouble in overcoming the various difficulties of domestic manufacturing including shipping parts and labour costs that were allegedly higher than the overseas plants.
Another factor adding to the closure is the poor sales of Moto X of around 900,000 globally compared to the 26 million unit sales of Apple’s iPhone 5S in the first quarter. Moto X was little over priced – initially at a $600 price that dropped later for $399, made it very difficult to justify the higher costs incurred at the Texas plant.