Joint venture with TV giant merges 200 jobs

CARMEL, Ind. -- About 200 of the dwindling number of Thomson Consumer Electronics employees in suburban Indianapolis would work for the company's new joint venture with a Chinese television giant.\nThomson's French parent company, Thomson SA, and TCL International Holdings Ltd. announced plans Monday to create a joint venture that they hope will eventually become the world's largest manufacturer of television sets.\nThe deal is not expected to affect Thomson's other remaining operation in Indiana, a picture tube plant in Marion with 860 workers, company spokesman Dave Arland said Monday.\n"We're looking to find ways to grow a profitable consumer electronics business. The new company will have the scale it needs to be profitable, we believe," Arland said.\nThe new company, to be named TCL-Thomson Electronics, is expected to be established by mid-2004 if shareholders and regulators approve. TCL International would hold a 67 percent stake in the new company, and Thomson 33 percent.\nThe Carmel operation houses Thomson's North American headquarters. Of its current 1,100 employees, about 200 in finance, supply and other areas will become employees of TCL-Thomson, Arland said. The joint venture will contract with the independent Thomson operation for sales, distribution, industrial design and other services.\nThomson is eliminating other Carmel jobs as part of a plan to save $25 million to $30 million annually. As many as 150 people will receive voluntary payouts, but other workers likely will be laid off before the end of the year, Arland said.\nOther consumer electronics companies are taking similar steps as the industry's giants contend with cheaper competition. Sony Corp. announced last week that it would slash 20,000 of its 161,000 jobs worldwide over the next three years.\nMuch of the cheaper competition comes from Chinese companies, which accounted for about 4 million of the 25 million televisions sold in the United States last year.\n"I think all companies in the electronics or television business are finding ways to deal with this," Arland said.\nThomson currently sells 7 million RCA televisions worldwide, including some under the GE brand in the United States. The venture with TCL would sell 18 million annually, catapulting ahead of current worldwide sales leaders Sony, Panasonic and Philips, Arland said.\nThe deal would open China and its population of 2 billion for RCA television sales and also might introduce the TCL brand to the United States.\n"This opens up a huge market for Thomson, a huge, underserved market for Thomson," Carmel Mayor Jim Brainard said, "and it should be very good for the corporate headquarters here and the employment base in Carmel."\nThomson will turn over to the venture its television manufacturing plants and businesses in Mexico and, worldwide, all of its DVD player business and television and DVD player research and development centers.\nThomson has closed plants in Bloomington and Indianapolis in recent years.\nThe Marion plant currently supplies picture tubes to Thomson's Mexican operations. Half of Marion's production is sold to other manufacturers, Arland said.\nThe Marion plant employed as many 2,300 workers a few years ago. It has eliminated 700 jobs over the past year, Arland said.\nA message seeking comment on the joint venture was left Monday with the Marion employees' union, Local 1160 of the International Brotherhood of Electrical Workers.