Hutchison CAT cuts more jobs

21 Sep 2005

Thai cellco Hutchison CAT Wireless Multimedia – 65% owned by Hutchison Whampoa subsidiary HTIL and 35% by state-controlled CAT Telecom – cut its workforce by around 100 staff last week as it continues to reduce costs in a competitive market. The company’s ongoing redundancy plan has lowered its headcount from around 1,500 at the start of the year to 1,000 today, with most of the cuts being made in its product and application development departments. So far, Hutchison Whampoa’s trick of providing heavy handset subsidies to rapidly gain market share has failed to ignite the Thai mobile market and its joint venture partner, CAT Telecom, has been warned by the government that it needs to raise more cash.

Hutchison CAT Wireless Multimedia offers CDMA2000 1x services in 25 provinces in the greater Bangkok area, and basic voice services over CAT Telecom’s CDMA IS-95A network in the rest of the country. However, whilst its market share remains well below 10% after two years of operation, the company has racked up heavy losses on expensive marketing campaigns and hefty handset subsidies. Furthermore, the Thai government has told CAT Telecom that it must raise new capital to clear its THB4 billion (USD100 million) share of the cellco’s losses or risk further delay in its plan to float on the Thai Stock Exchange.

Thailand, CAT Telecom, Hutch (Thailand)