Two-thirds of AST's Australian staff were retrenched last week as part of worldwide cuts. The remaining one-third are employed in marketing, sales, service and technical support. In April AST cut one-quarter of its worldwide workforce and this latest round of cuts will eliminate about 1120 jobs, or 37 per cent of its entire staff.
As part of the shake-up, AST around the world will also move to the build-to-order manufacturing and distribution model.
Trading to cease
Now a wholly-owned subsidiary of Samsung Electronics, AST Australia will cease trading at the end of this year when Samsung takes over its Australian distribution. It will enter a "cooperative manufacturing arrangement" with Samsung at its main plant in Dongguan, China.
Samsung Electronics Australia vice president Pat Byrne says most AST products will be sold with the AST brand name, but some may be sold as Samsung products.
He says the majority of AST products will be assembled in the US.
Byrne says there will be no changes for the channel or for the end users.
With such a huge staff loss from AST, some industry pundits doubt whether Samsung can continue to provide the channel with the level of service and support that AST provided.
However, Byrne claimed Samsung's technical support will be sufficient. "The support systems that we have at the moment will adequately cover the support requirements between us and the AST dealer network," he says.
Dicker Data general manager Fiona Dicker last week said her company hadn't been officially informed of the move, but she doesn't see any reason why the level of service for the channel would alter.
"I would anticipate that they would make every effort to satisfy the channel," she said.