Gateway turns out the lights in NZ and Australia

By Phil Boeyen, ShareChat Business News Editor

Wednesday 29th August 2001

One of the world's biggest PC companies, Gateway, is pulling out of New Zealand and Australia as part of a global review of its business.

The US-based company, familiar in the computer market for its distinctive black and white bovine branding, says it has closed all its stores in the two countries and is ceasing sales and marketing activities immediately.

The company's Asia Pacific vice-president, Sam Weiss, says the regional closure announcement is among several market withdrawals being announced internationally.

"In the overall context of rapidly changing PC market conditions, Gateway undertook a company-wide operations review on a market-by-market basis during August 2001 which focused on seeing how we could implement our solutions strategy to grow and be profitable in all target markets.

"Regrettably, the company has concluded that it will not be able to invest the necessary resources to achieve this result in Australia or New Zealand. We are therefore ceasing sales operations here."

All 18 Gateway stores throughout Australia and New Zealand have been closed, making 19 people redundant in New Zealand and a further 200 across the Tasman. Staff were told of the closures this morning.

Gateway says no further orders will be taken for its products and customers who ordered in the last 14 days will be eligible for a full refund. Support, warranty and parts services will continue.

As part of the regional announcement, Gateway is simultaneously closing a manufacturing plant in Malaysia with the loss of around 430 jobs.

In New Zealand, retailing giant The Warehouse (NZSE: WHS) has been selling Gateway products at its Warehouse Stationery stores since June last year.

CEO Greg Muir says the brand has been doing well for the company but it is yet to be resolved whether it will be able to continue selling the computers, which are sourced internationally.

Although Gateway was the company's first foray into PC sales Mr Muir says the stores also now carry HP products and are considering adding other computer brands to the lineup.

He says not being able to stock Gateway would have minimal impact on the business.

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