NCR Corp. said it awarded a five-year contract to manufacture its automated teller machines and self-service checkout units in the Americas to Solectron Corp. of Milpitas, Calif.
This month NCR said it was making fundamental changes to its business model, including outsourcing the production of its machines in the Americas, but it did not say what company would take over that task.
The Dayton, Ohio, company has factories in Sao Paulo Brazil, Dallas (where it makes merchant ATMs), and Waterloo, Ontario.
Facilities in Europe and Asia will increase their ATM output, NCR said, except for the Dundee, Scotland, factory, whose ATM manufacturing will be transferred to a facility in Budapest.
The Dundee facility will continue to handle research and development and to make specialized equipment, the company said.
“We believe this strategy will play a key role in helping us improve our longer-term operating margin,” Bruce Langos, NCR’s senior vice president of global operations, said Tuesday in a press release.
Also this month, NCR announced that it was spinning off Teradata, its database software, data mining, and support services division, in part because it lacked synergies with NCR’s other business lines.
Solectron makes products for companies in such industries as networking, telecommunications, computing, storage, automotives, and aerospace. It has been building Teradata data warehouse servers for NCR for seven years.
Kartik Mehta, an analyst with First Horizon National Corp.’s FTN Midwest Research Securities Corp., said that NCR wants to be a “leaner organization” particularly in manufacturing. “I think this will help lower costs for the new NCR and I think that’s positive.”
