Dell shifts manufacturing from Ireland to Poland

By Andras Gergely

DUBLIN (Reuters) - Dell (DELL.O), the world's No. 2 PC maker, is shifting its European manufacturing base from Ireland to Poland and cutting 1,900 of 3,000 jobs at its Limerick plant in a bleak start to the year for the shrinking Irish economy.

Dell, which ranks itself as Ireland's largest exporter, largest technology company and second-largest company overall, said on Thursday it would move production of computer systems for customers in Europe, the Middle East and Africa to its Polish plant and third-party manufacturing partners.

The cuts at Dell's Limerick plant, part of a $3 billion (1.97 billion pound) cost-reduction plan announced last year, comes just three days after Waterford Wedgwood (WTF_u.I), one of Ireland's premier luxury brands, called in receivers.

"This is a difficult decision but the right one for Dell to become even more competitive," said Sean Corkery, Dell vice-president of operations in Europe, Middle East and Africa.

The lower cost of labour in Poland forced the company's hand, he said later in an interview with RTE radio.

Ireland was the first euro zone country to slide into recession last year and dole queues are expected to lengthen this year as the global economic downturn grips and the weakness of sterling against the euro hits exports.

On Tuesday, a union at Tara mine, Europe's largest zinc mine, said Swedish owner Boliden (BOL.ST) was considering stopping production with a potentially devastating impact on the local community in county Meath, outside Dublin.

Dell layoffs in Limerick, a traditionally impoverished area made famous by the book and film "Angela's Ashes," will start in April and wind up in January, 2010.