O.C.-Based AST Fires 530 Workers at Hong Kong Plant : Technology: Irvine computer company says the move to trim expenses will cut earnings by $20 million.

AST Research Inc. has fired 530 employees at a factory in Hong Kong as part of what the company said is an effort to cut costs and buy more of its computer components from outside vendors.

The Irvine-based computer manufacturing giant also said its second-quarter earnings will be reduced by $20 million as a result of the restructuring. The troubled company has posted five consecutive quarterly losses totaling almost $196 million.

The changes will reduce AST’s employment in Hong Kong to about 500, said Gary Weaver, vice president of worldwide operations. The employees affected by the cuts worked in a circuit-board assembly plant, an operation that is being consolidated at AST’s facilities in China, where the company employs about 1,000 people.

“Hong Kong is an expensive place” for manufacturing, said Weaver, adding that hourly wages for assembly workers in Hong Kong average $4 an hour, far higher than the 50 cents per hour assembly workers are paid in China.

Weaver said some of the equipment from the Hong Kong circuit board assembly operation will be moved to China, but he also pointed out that AST is manufacturing fewer of these boards itself, turning instead to outside suppliers, including Intel.

Until earlier this year, AST had made about 90% of the circuit boards installed in the company’s computer, but that percentage has recently dropped to about 50%, Weaver said. Circuit boards are flat panels containing the electronic components that serve as the brains of the computer.

AST will continue to assemble desktop computers in Hong Kong, and the company’s facilities there will serve as the headquarters for AST’s Asian operations, Weaver said.

The cuts bring AST’s worldwide employment to about 6,000, including 550 in Orange County. The company also has facilities in Texas, Ireland and Taiwan.

AST has struggled in recent years with product delays and management missteps that have cost the company market share. Last month, company founder and longtime chief executive Safi U. Qureshey stepped down and was replaced by Ian Diery, a former executive at Apple Computer Inc.