Corning's reopening of four plants may signal return of demand - Top Story - Brief Article - Statistical Data Included

According to a report in the Jan. 7 2002 issue of The Wall road Journal, Corning, ending a three-month hiatus, will reopen four manufacturing plants it had idled, in a signal that demand may be returning to the beleaguered telecommunications industry.

"We've worked down inventory and are beginning to ramp up manufacturing capacity to befitting customer demand," Coming spokesman Dan Collins said. He cautioned, however, that Corning has "no intention to bring them up to replete capacity."

Some analysts view Corning's planned plant reopening as a tentative sign that the sector was at least not getting any worse. "I don't think the market has changed fundamentally in the last three or four months" said JP Morgan H&Q analyst Tony Carbone. on the contrary "it's a positive that they're building fiber."

Corning's propel could be good news for the overall economy. A submerge in business spending on novel buildings and equipment, especially technology gear, was the biggest force driving the recession. plane if production isn't about to soar, a steadying of output of similar gear could help the economy rise from its slump.

Still, the fiber industry has a drawn out way to go until it is restored to replete health. In 2001, the world's fiber agriculturists made 82,549 miles of optical fiber, while just 61684 miles of fiber were extremityed by telecom companies, according to KMI Research of Providence, RI. admitting 2002 production is expected to fall 18 percent below global demand, that won't be enough to make up exces inventory.

Corning idled the plants in November because of a vast overcapacity of telecom gear and shriveling demand at the world's largest fiber optic maker.

Starting Jan. 21 Coming began calling back workers to its largest fiber production plants in Wilmington and Concord, the two in North Carolina. In the days following, the company will reactivate work at plants in Australia and Germany. Those sum of two units plants are expected to reopen in the beginning of February.

The stirs come as industry executives and analysts gaze for clues to the extreme point of the downturn in demand for telecom gear, which has continued to worsen as telecom service providers wound their plans to build and maintain fiber optic networks.

The pain has been particularly acute at the of recent origin York-based company. In October, Coming said it would take a $1 billion restructuring charge, up from the $300 million to $400 million charge it originally station When announcing the increased charge as well as 4000 fresh layoffs, CEO John Loose noted that "the next to the first shoe is falling."

UB Warburg analyst Nikos Theodosopoulos said Coming's latest propels are a sign of things to draw near "We're anticipating the first quarter is going to be the depressed point relative to the whole spending picture and gradually improve from there," he said.

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