McDonnell’s Computer Unit Laying Off 290 : Staff Reductions Part of Major Restructuring
As part of a major restructuring of its unprofitable computer business, McDonnell Douglas’ Information Systems Group has laid off 290 people across the country, including about 50 at two divisions in Orange County.
The 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, a computer maintenance company, and McDonnell Douglas Computer Systems, which manufactures computers for specialized businesses.
Layoffs Began Last Month
A company spokesman in Irvine said Tuesday that the restructuring should be completed within several weeks. When the restructuring was announced in late September, a company official said, “There may well be some layoffs.”
On Tuesday, the spokesman said, “It is unpredictable now if any more layoffs will occur, but there may be” some more.
The layoffs began last month and have included administrative, sales and marketing personnel, and middle managers and technicians.
St. Louis-based McDonnell Douglas said the restructuring of the Information Systems Group is geared toward strengthening its most profitable businesses and products and stemming losses at its 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. We want to apply resources to those operations that are profitable.”
The Information Systems Group has been struggling since its formation 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 after having lost $109.3 million in 1985.
The computer systems unit employs about 800 people at 11 facilities in Irvine and Newport Beach. The field services group employs 200.
