One Xbox 360 Manufacturer Ceases Production of the System

Microsoft announced today that they would be “voluntarily” expiring their contract with the Taiwan-based Wistron on July 1st this year. This cuts back Xbox 360 production to Microsoft’s two other manufacturers of choice, Celestica and Flextronics. The primary reason for this break-up seems to be lack of profit on Wistron’s end. Also, Wistron was allegedly not too happy with Microsoft also in business with their competitor Celestica.

Microsoft asserted that, “these types of adjustments are considered a common business practice within the consumer electronics industry and should not reflect on the relationship between Microsoft and Wistron.” The statement continued, “also, this does not affect our guidance which still implies we expect to sell about 12 million Xbox 360 consoles by end of June 2007.”