Lego Joins the Outsourcing Bandwagon

Monday, November 20, 2006

Lego Joins the Outsourcing Bandwagon

From the N.Y. Times:
BILLUND, Denmark — This is the town that bricks built. Ever since Legos were invented here in the 1940s, many of the townspeople have worked making those toys, which are a particular hit at Christmas.

But now, it seems, Santa has decided to hire elves for his brick-making in Mexico and the Czech Republic, where they would be paid less than the ones in Denmark.

... the number of jobs at Lego in Billund will drop to 1,600, from the current 2,500. Five years ago, Lego employed 4,000 people, who held roughly half of all the jobs in Billund.

“The population has faced it, that it’s very vital that Lego change, or I’m afraid there would have been no Lego in five years,” said Preben Jensen, 59, an air traffic controller at the local airport who also serves as the town’s mayor. “Production in Western Europe is so expensive.”

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