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By | Simon Rockman 25th November 2014 15:25

Lenovo: We'll say HELLO MOTO to profits in 18 months

Make ex-Google mobe firm a success

Lenovo is looking to do for Motorola mobiles what it did for the IBM Thinkpad, kicking life into the products and making the company profitable.

The aim is to make the company profitable in the next 18 months. All 3,500 people who had been working for Motorola under Google ownership have transferred to Lenovo, and while the company hasn’t specifically said that there won’t be any cuts it’s unusual for there to be any mention of “Motorola returning to profitability” without such an announcement.

Indeed, in August 2000, Motorola had 150,000 employees, so Lenovo’s headcount is under three per cent of the workforce of what used to be called Motorola. That’s not quite like for like as the previous figure includes the chip division, now called Freescale, infrastructure and emergency services products – which are now separate – and even a handful of special projects people who stayed with Google... but it’s still a spectacular plummet from grace.

Around 2,800 of those 3,500 staffers are based in the US, Motorola Mobility having moved from the former factory site in Libertyville to offices in central Chicago.

CEO Yang Yuanqing plans to introduce more Motorola products, and at lower price points than the already excellent-value-for-money Moto G. New products will be targeted at China, where Motorola has historically been held in high regard.

Google ran down Motorola’s distribution network and Lenovo seeks to repair that damage by using its own distribution chain. Yuanqing said: “Motorola brings a strong presence in the US, North America and Latin America, as well as an iconic brand.”

Making Motorola profitable is a tall order: it made a loss of $68m and in Q2 and $454m in the same quarter the year before.

Lenovo execs have filled the top spots at Motorola: the executive vice president and president of Lenovo’s Mobile Business Group, Liu Jun, was appointed chairman of the Motorola Management Board while Rick Osterloh remains as president and COO of Motorola. Osterloh joined Moto before the Google acquisition as a result of Motorola buying (and later selling) Good Technology. ®

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