Motorola to shutter Texas factory building Moto X

About a year after opening the US plant, the handset maker is calling it quits on its attempt to build smartphones domestically.

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Motorola

Handset maker Motorola is closing down a factory in Fort Worth, Texas, where it manufactures smartphones, the company confirmed to CNET on Friday.

The shuttering ends the company's attempt to build the devices in the United States, while the majority of the industry makes smartphones in Asian manufacturing centers. The Texas factory will close by the end of the year. The Wall Street Journal reported news of the closing earlier today.

The plant builds Motorola's Moto X line of smartphones and employs about 700 workers.

"What we found was that the North American market was exceptionally tough," Motorola President Rick Osterloh told the Journal. The company declined to comment beyond the Journal story.

For now, the company is still owned by Google, though the search giant in January announced that it would be selling Motorola Mobility to Chinese PC maker Lenovo for $2.9 billion. Google bought Motorola in 2012 for $12.5 billion, and will still hold onto the hardware maker's trove of patents in the sale.

The deal is expected to close later this year. A Motorola spokesperson, however, stressed to CNET that the decision to shutter the plant did not have to do with the planned sale.

The plant, which opened in May 2013, could not overcome some of the difficulties of domestic manufacturing. Costs for labor and shipping parts were higher than in overseas factories. That, plus poor Moto X sales, factored into the closing.

According to the Journal, Motorola sold 900,000 Moto X smartphones globally in the first quarter. In contrast, Apple sold 26 million of its iPhone 5S in the same period.

Motorola said it will still manufacture the Moto X in other plants, including in Brazil and China.

 

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