updated 07:45 am EDT, Thu September 29, 2011
Nokia to slash 3,500 more jobs
Nokia has announced a new round of job cuts totaling 3,500 jobs. The company says the cuts are part of its next phase in improving efficiencies in manufacturing, its Location & Commerce division, and their supporting functions. Most of the cuts will come with the closure of its Romanian manufacturing plant in Cluj, with 2,200 jobs to go as a result.
The remaining 1,300 job losses will be slashed from the Location & Commerce division, which includes the Navteq digital mapping group. The latest round of job cuts come after 4,000 jobs were lost after the company moved to drop its in-house Symbian OS for Windows Phone 7.
The closure of the factory in Cluj comes as something of a surprise as it was opened as recently as 2008 at a cost of $88 million. "The European market has shifted towards smartphones, whereas the feature phone market is predominant in Asia and we can get greater scale and proximity benefits by using our Asian factories in China and Korea," said a company spokesperson.
"We are seeing solid progress against our strategy, and with these planned changes we will emerge as a more dynamic, nimble and efficient challenger," said Stephen Elop, Nokia President and CEO. "We must take painful, yet necessary, steps to align our workforce and operations with our path forward."
"Europe is core to Nokia's future. In addition to our headquarters, we have a strong R&D presence in Europe. We have four major R&D sites in Finland and two major R&D sites in Germany, as well as Nokia Research Centers and other supporting R&D sites in Europe. Nokia also retains a strong local presence in our many sales offices throughout this region, as well as our operations in Salo and Komarom," said Elop.
Nokia also added that it will offer all affected staff a comprehensive support program in line with its company values. Over the past twelve months, Nokia's shares have fallen by 40 percent. Following the latest announcement, shares dipped a further 0.14 percent and are currently trading at €4.17.