EASTMAN Kodak is to stop making cameras, marking the end of an era for the manufacturing business started more than a century ago by George Eastman, the photography pioneer.

The troubled photographic equipment maker is to outsource its remaining camera making businesses to Flextronics, a hi-tech designer and manufacturer, as Kodak continues to struggle in the digital arena.

Flextronics will manufacture and distribute Kodak consumer digital cameras, while Kodak will continue to control high-level system design and advanced research and development.

Some 550 Kodak employees will transfer to Flextronics, which will also acquire a substantial stake in Kodak’s digital product centre in Japan.

“This agreement will bring our camera products to market more quickly, with greater predictability, flexibility and cost efficiency, while maintaining innovative ease of use,” said John Blake, vice-president of Kodak’s Consumer Digital Imaging Group.

The decision to offload its camera manufacturing arm is an historic shift for Kodak, whose founder started making cameras in 1887. A year later George Eastman mass produced the first easy-to-use camera for non-professionals, catapulting the company to the forefront of the photographic age.

But Kodak failed to keep up with the digital revolution in photography, sticking stubbornly to the dwindling market for film for far too long.

Last year, the company said that it would axe 25,000 jobs at a cost of $3 billion (£1.6 billion) as part of a restructuring programme. The company said last night, however, that it had increased its job cuts target to 27,000 and that the cost would increase to $3.4 billion.

Kodak also revealed a bigger than expected loss for the second quarter of the year. It reported a net loss of $282 million, compared with a loss of $155 million a year earlier. Some $246 million of the loss was attributed to restructuring charges.

Eastman Kodak shares plummeted more than 13 per cent to $19.26 after hours on Wall Street.

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