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Toshiba America Hires 100 to Hike O.C. Production

September 29, 1993|DEAN TAKAHASHI | TIMES STAFF WRITER

IRVINE — Rebounding after several years of retrenchment, Toshiba America Information Systems said Tuesday that it has hired 100 workers to expand its portable computer production in Orange County.

Toshiba America Information Systems, which has annual sales of about $1 billion, said the new employees will bring its U.S. payroll to 1,700, close to its peak of 1,800 in 1991. About 1,350 are employed in Irvine, spokesman Bob Wittenburg said. Besides computers, the Toshiba division makes copiers, printers, fax machines and disk drives.

Toshiba said it will increase its production of laptop and notebook computers from 25,000 a month to 35,000. The new employees will assemble computers with color active-matrix displays that were formerly made in Asia.

The decision to make color notebook computers, which can fit inside a briefcase, is significant because 55% of all the portable computers that Toshiba sells now require active-matrix color displays.

Atsutoshi Nishida, president of Toshiba America Information Systems, said the company is committed to making its computers in the markets where they are sold.

He said the company, a subsidiary of Toshiba Corp. in Tokyo, is pleased that the U.S. Commerce Department agreed this year to lift a tariff on active-matrix displays, making possible the expansion of the Irvine operation.

The tariff, imposed in 1991, had levied a 62.7% tax on any active-matrix color screens--the highest quality for portables--that were brought into the United States. Because the tariff did not apply to screens that were shipped in as part of finished computers, manufacturers shifted production of portable computers overseas.

Critics said the tariff protected a small group of screen makers in the United States at the expense of thousands of jobs in the computer industry. The Commerce Department lifted the tariff in June.

Portable computers known as notebooks, which weigh 5 to 8 pounds apiece, require the color screens and are now the most popular computers.

Despite the lifting of the tariff, it isn't clear whether Toshiba is turning a profit on its portable computer sales. Sales volume has skyrocketed, but prices have fallen drastically.

Toshiba pioneered laptop computers, but it is weathering a fierce price war that began in 1991 when rivals such as AST Research Inc. in Irvine brought out lower-cost models.

Because Toshiba at first missed the shift from bulky laptops to lighter notebooks, it nearly lost its No. 1 position in the U.S. portable computer market, dropping from a 21.8% share for 1989 to 14% for 1991. The company subsequently laid off several hundred employees and launched an overhaul of its product line.

Its lower-priced series helped it bounce back to a 16.2% market share last year, according to International Data Corp., a market research firm in Framingham, Mass.

"We are exceeding our overall market share growth dramatically," said Steve Lair, the top marketing executive in the computer systems division.

Earlier this week, Toshiba said its line of computers will be sold by Merisel Inc., the El Segundo-based distributor of computers. The deal will expand Toshiba's ability to reach a variety of retailers, Lair said.

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