It hasn’t been the best of years for HTC, announcing their first ever operating loss earlier this month, after first announcing some issues sourcing parts and it appears that sales may not have improved yet according to a Reuters report that’s just been released.
According to Reuters who claim that they have seen at least one of four factories operated by HTC closed during a visit to the former headquarters of the company in Taoyuan, outside of the Taiwanese capital of Taipei. The reporter from Reuters found the loading docks closed and a sign on the lobby door which said ‘Lobby is temporarily closed for use. Thank you for your cooperation’.
While a shuttered dock and closed Lobby, do not a closed facility make, according to sources that Reuters spoke to, two of the production lines at the facility had been combined into one, effectively almost halving production down to around 1 Million devices per month. This has actually been a longer term closure as indicated by further sources who advised that ‘Manufacturing has been halted since at least August on the line, housed in a facility called Building H, while production continued at a nearby plant known as TY5.’
Further sources indicated that production lines for smartphones at HTC’s Shanghai based manufacturing facility had also been closed down, ending supply of possibly a further 2 Million devices.
The sources also stated that HTC’s current financial situation was forcing them to look into possibly selling facilities in both China and Taiwan.
HTC however refutes the story, HTC Chief Marketing Officer Ben Ho in a phone interview with Reuters refused to comment directly on the factory in question but did advise
Like any manufacturer, we do volume planning to optimize our lines, our manufacturing and production facilities.
Whether we are operating those facilities depends on market demand and our own expectations. When you have less demand you work with less facilities to optimize your costs. When you have demand, or bigger growth, you definitely have to activate all these facilities.
And it seems that HTC wants to further re-enforce this point, stating in an email response to queries from Reuters that :
HTC in not shutting down nor has plans to sell any of its factory assets. HTC has a very strong balance sheet and will provide the latest financials in our upcoming earnings call to investors and the broader community.
It could all be a storm in a teacup, but with HTC’s performance over the last four financial quarters there may at least be a little bit of fire in this story. The best we can do is await the next quarters financial results to see if the release of the HTC One Max could possibly restore confidence in the Taiwanese manufacturer. Indeed there is a lot of good will towards the company who has often been seen as delivering some of the most well designed handsets in the Android market.
