More 21st century problems for 20th Century Fox.

Just days after Fox's movie boss Bill Mechanic left the studio (or was forced out, depending on the report), the company has shut down its animation studios.

The news also comes on the heels of the box-office loser Titan A.E., the third movie to come from Fox's Phoenix animation headquarters, which was designed to make traditional, hand-drawn 2-D animation and compete head-to-head with the Disney behemoth.

It's been six years since the studio opened with the creative team of director-producers Don Bluth and Gary Goldman.

The timing of the closure is somewhat ironic considering 20th Century Fox Animation recently finished transforming its Blue Sky Studio in New York from a special-effects production house to a digitally tripped out animation studio.

The toon types even hired an extra 150 employees to work on Ice Age, which starts production next week. The feature-length animated project will feature the voices of Ray Romano, John Leguizamo and Kristen Johnston. (The production of Ice Age won't be affected by the closing.)

"It's certainly disappointing news for everyone in Phoenix," Chris Meledandri, president of 20th Century Fox Animation, tells the Hollywood Reporter, adding that the remaining 60 employees were told Monday about the layoffs.

No word on whether the workers will be transferred to the New York studios.

"The marketplace has changed dramatically in the last six years, and while we were once in the business of producing animation, we found other opportunities to make different kinds of films with different kinds of filmmakers that became attractive to us," Meledandri continues.

Fox foreshadowed this week's announcement in February when it fired almost 260 of its 320 Phoenix employees.

Back in 1994, to much hoopla, Fox converted a 60,000-square-foot building in Phoenix into an animation studio to house 300 employees. Spending more than $100 million on its subsidiary, Fox said it would produce one full-length feature every 18 months in hopes of loosening Disney's stranglehold on the business.

But over the last six years, the studio (a pet project of Mechanic's) released just three: Anastasia, its direct-to-video prequel, Bartok the Magnificent, and Titan A.E.

Despite the shuttering of the Phoenix facility, Fox is not giving up on animation altogether. Some of the equipment from Phoenix has been transferred to Blue Sky, Meledandri says. And the studio has also inked deals with filmmakers like Peter and Bobby Farrelly, who are on board to make Frisco Pigeon Mambo, one of a half dozen toon projects still on the old drawing board.

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