And look what I found today!! Kodak might be joining Motorola and TFS in the desert display oasis! -- JimA
November 17, 1997
Kodak project exposed
Martha Netherton The Business Journal
Eastman Kodak and Valley officials were moving close to a deal that would bring a major Kodak operation to Phoenix or Tempe, until this week when Kodak announced a major restructuring.
Kodak's move to restructure the company and cut 10,000 jobs will disrupt the timing, at the least, although both company officials and Valley leaders were scrambling to figure out exactly where the deal stands.
Kodak still appears ready to move ahead with a $100 million flat-panel display facility that will employ about 200 people.
Company fficials said they still are leaning heavily toward Phoenix as the site.
"We have been looking at sites for a new product," said a Kodak official. "This is emerging business and a piece of our new digital
imaging future."
Kodak officials toured the Valley about a month ago and met with Phoenix and Tempe officials.
"We were headed toward Phoenix and Phoenix officials knew that," the Kodak executive said. "The availability of leased sites was
excellent, and we were not too happy with the alternatives."
Officials also had scouted sites in San Diego and considered expanding the company's home base in Rochester, N.Y.
In the Valley, Kodak officials looked at several buildings near Elliot and Kyrene roads in Tempe.
"There are a couple of existing locations in Phoenix and Tempe we could lease to get the startup going," the official said. "From a
business standpoint, no new business wants to build a new building."
Kodak also is impressed by the labor force in the area.
"The colleges are producing the expertise we need," the official said. "The availability of employees seems quite good."
Though the restructuring announced this week is not likely to affect the company's plans to broaden its technology base, officials did
indicate that the timing of the project has been delayed, and that it's unlikely a decision will be made before the end of the year.
"We've backed off a little bit," the official said. "It's a very sensitive subject, especially now. The company has much bigger things to deal with."
Early this week, Kodak announced that it would take a $1 billion pretax charge and lay off 10,000 employees -- 10 percent of its work
force -- over the next two years.
The action was aimed at stopping the downward slide that's characterized Kodak's recent performance. Third-quarter income was down 43 percent, the world's biggest film manufacturer announced last month. The company also has lost about 3 percentage points of U.S.
market share to Japan's Fuji, the No. 2 player. In addition, losses are said to be piling up from Kodak's push into digital products and
services, and the strong U.S. dollar is eating into company profits as half of Kodak's revenue comes from overseas.
Among the few details provided by Kodak officials during the announcement this week was that Kodak will spend $100 million to $150
million less on research and development in 1998.
On the other hand, the company will continue to focus on its digital effort. Kodak has been spending $400 million a year to create a new
generation of cameras and services based on digital technology. Among the company's stated plans are to put digital kiosks in
photo-processing shops and connect them to a worldwide network.
c 1997, The Business Journal |
