Motorola to Close O.C. Semiconductor Plant

Unable to find a buyer for its gigantic manufacturing plant, Motorola Inc. confirmed Tuesday that it will close its Irvine Spectrum semiconductor factory later this year, eliminating 500 jobs in the process.

A Motorola spokesman said there could be relatively few layoffs, though, as most of the workers will be offered jobs at out-of-state semiconductor factories operated by the company. The closest are in Phoenix, where Motorola has a complex of eight factories.

The Irvine closure has been anticipated since Illinois-based Motorola announced more than a year ago that it would begin consolidating operations and eliminating stand-alone plants such as the 224,000-square-foot Spectrum building.

It is the largest factory in the Irvine Co.’s sprawling business park, which is geared toward research, high-tech and corporate office locations.

Motorola, which bought the building from Western Digital Corp. in 1994 for $111 million, stuck a “For Sale” sign in the front lawn last October, but has been unable to find a serious buyer.

The semiconductor industry is overbuilt right now and several brand new plants--including one constructed in Colorado by Rockwell International’s Newport Beach-based semiconductor unit--are sitting idle.

While industry officials once thought demand for semiconductors would grow by almost 209% this year, Motorola and others now are predicting a 2% decline in demand worldwide.

“You can only go so long waiting for a buyer,” Motorola spokesman Lonnie Hurst said. “We want to deploy these people and this equipment elsewhere.”

He said Motorola plans to empty the Irvine building by the end of the year.

Employees should start getting invitations to in-house job fairs within the next month, Hurst said. Those who opt not to transfer to another Motorola plant will receive local job hunting assistance.

Motorola announced last month that it intends to slash its payroll by 15,000 jobs, or 10% of its worldwide work force. Hurst said Tuesday that the company hopes to accomplish the job cutting through attrition and voluntary early retirements.

Skilled manufacturing employees such as those in Irvine, he said, remain in demand. “We’re talking redeployment,” not termination, he said.

Motorola makes micro-controllers and digital signal processors at the Irvine plant, mainly for the consumer electronics and wireless communications markets. It is the only Motorola semiconductor plant in California.