OK, there is a decent Oracle at Delphi allusion to be milked here, but this is a serious topic, so I'll move on without indulging.
U.S. car parts maker Delphi has suspended work at a factory in Suzhou due to shrinking demand amid the global economic slump, a media report and a staff member said Monday.
The factory west of Shanghai in the city of Suzhou makes compressors for General Motors. Calls to the plant rang unanswered Monday.
"The sudden and unprecedented decline in (car) sales globally has resulted in our only customer, General Motors North America, announcing plant closures and plant stoppages," the Hong Kong newspaper South China Morning Post quoted a Delphi internal document as saying.
"Unfortunately our only customer in 2009 is GMNA, and this has placed the Suzhou compressor plant in a very dangerous position," it said.
Talk about globalization, huh? I think that tidbit will make it into the next edition of whatever book Thomas Friedman is peddling these days.
But the important part of all this is: next year is going to suck big time, folks. Happy New Year.
By the way, I've noticed that almost every company I read about in the news that is cutting significant staff seems to be choosing 10% as the magic number. Anyone know why it is always 10%?
If I was younger and naive, I would assume that this was somehow tied in to an expected degree of slowdown in the economy and that 10% represented the necessary number of layoffs to hold these firms over until things got better.
But I'm not young, and I'm very cynical, and I guess that 10% is a nice, round number that companies have just pulled out of their asses for this first round of cuts. If anyone knows differently, though, please tell me.