Gateway closes door on Europe

PC maker to close Dublin headquarters

PC manufacturer Gateway is throwing in the towel on Europe in an attempt to return to profitability.

The company admitted last week that it has begun the consultative process required by law to close its European headquarters in Dublin, along with a sales and marketing operation in Uxbridge, west London.

The proposed closure, which could take place within a month, will entail the loss of up to 1000 jobs.

"We are consulting with employees over the proposed closure of the Irish and UK operations, but there are no final decisions at present," a Gateway representative told vnunet.com's sister publication Computer Reseller News. "The timeline for the final decision will depend on the meetings with the employees' representatives and the issues and areas that are raised for consideration."

Earlier this year, the troubled vendor was forced to cut 3000 jobs worldwide, including 1000 in the UK, because of poor results.

Gateway also revised its first quarter 2001 results, admitting that it was considering making an exit from "some European markets".

Ted Waitt, one of the founders of Gateway, returned as chief executive in February, claiming that he expected the company to return to profitability in the second half of 2001.

Gateway said it has less than two per cent of the PC market in the UK and about four per cent in Ireland.

"In international markets, we just don't have the brand presence and awareness, or the distribution capability that we have with our stores," Waitt said.

Richard Holway, an analyst at Ovum Holway said the announcement reflects the state of the market, adding that it is probably good news for channel players such as Computacenter and SCH because it will mean "fewer competitors for a dwindling market".