STMicroelectronics has stood by the statement of its chief operating officer that the group has no plans to shut down European factories, despite an earlier announcement by its chief executive officer that six factories would be closed or downsized.
The chipmaker's head of communication, Carlo Ottaviani, pointed out that the specific reference to the closure of factories by group CEO Carlo Bozotti in the Financial Times last month was not aimed at European plants.
Mr Bozotti was said by FT to be looking into saving about $150 million through downsizing or closing six factories. He would not be drawn into saying which European factories would be affected but clarified that in this case restructuring did not "necessarily mean closure". Last week, the chipmaker's CEO, Alain Dutheil went a step further and was quoted by Forbes.com saying that the company had no plans "for more factory closures" following those of three plants in the United States and Morocco last year.
The confirmation, which follows an initial no comment by both the mother company and the local management, may prompt employees in the Kirkop plant to draw a sigh of relief but the company remains unclear about its plans for the future.
The company would give no further comments about its plans, which could still include radical downsizing of its Malta operation. In fact, while welcoming Mr Dutheil's comments, the Finance Ministry but would not comment further.
The Kirkop plant is said to be facing losses that could reach €58 million (Lm24.9 million) a year, primarily as a result of labour costs and exchange rate pressures. The latter, in particular, has been exacerbated by the growing gap between the dollar, the currency in which the company trades its semiconductors, and the euro, the currency in which the company pays its bills, including salaries, as Mr Bozotti had pointed out to FT.
The Franco-Italian group, one of the world's largest chipmakers with a global revenue of some $10 billion, employs about 2,200 workers locally and is Malta's biggest exporter.