McDonnell Douglas Announces 290 Layoffs in Computer Unit
As part of a major restructuring of its unprofitable computer business, McDonnell Douglas Corp.’s Information Systems Group has laid off 290 people across the country, including about 50 at two divisions in Orange County.
The information-systems group, which has 11,500 employees worldwide including 1,000 in Orange County, has no other operations in Southern California.
The Orange County layoffs are concentrated at two Irvine-based units, McDonnell Douglas Field Services Co., a computer maintenance outfit, and McDonnell Douglas Computer Systems Co., which manufactures computers for specialized businesses.
A company spokesman in Irvine said Tuesday that the restructuring, first announced in late September, should be completed within several weeks.
“It is unpredictable now if any more layoffs will occur, but there may be (some more),” the spokesman said.
The layoffs, which began last month, have included administrative, sales and marketing personnel and middle managers and technicians.
The St. Louis-based company said the restructuring is geared toward strengthening its most profitable businesses and products and stemming loses at other operations.
“We want to free up resources so we can operate more efficiently,” the spokesman said. “Some of our products may have achieved the end of their life cycle. This would free up funds for research and development for new products.”
The Information Systems Group has been struggling since being formed in 1984 as part of an effort by McDonnell Douglas to diversify beyond its core aerospace and defense businesses.
The group lost $69.7 million on revenues of $1.2 billion in 1986. The unit lost $109.3 million in 1985.
“We do have profitable operations in every one of our business units,” the spokesman said. “We want to apply resources to those operations that are profitable.”
The computer-systems unit employs about 800 people at 11 facilities in Irvine and Newport Beach. The field services group employs 200 in Orange County.
