Nokia this morning announced “plans to take additional actions to align its workforce and operations”. You know what that means: mass layoffs and then some. In a press release, the Finnish mobile giant says it will reduce its staff by at least 3,500 employees by the end of 2012.
Nokia also says there will be reductions in manufacturing; the company is closing its manufacturing facility in Romania by the end of this year and says it will be doubling down on its Asian factories instead.
Nokia will also “review the long-term role” of its manufacturing operations in Salo (Finland), Komarom (Hungary) and Reynosa (Mexico).
Less than half a year ago, Nokia cut 4,000 jobs and transferred another 3,000 Symbian employees to Accenture. We assume the layoffs announced today are in addition to those cuts.
In a separate statement, Nokia says it has found a new executive chairman for Nokia Siemens Networks (current chairman Olli-Pekka Kallasvuo is stepping down), and that it is investing another 500 million euros (roughly $682 million) in the business – as will its partner Siemens.
Joy to the world!
What a trainwreck.
Full press release:
Nokia continues to align its workforce and operations
ESPOO, FINLAND–(Marketwire – Sep 29, 2011) -
Next phase of changes to improve efficiencies in manufacturing, Location & Commerce, and supporting functions
Espoo, Finland –
Nokia today announced plans to take additional actions to align its workforce and operations.
The measures support both the execution of the company’s strategy and the savings target the company announced earlier this year, and also target to bring efficiencies and speed to the organization.
Earlier this year, Nokia announced changes primarily focused on aligning its R&D operations in Smart Devices and Mobile Phones. Today, the company announced the next phase of operational alignment, which includes plans for reductions in manufacturing, the Location & Commerce business, and supporting functions.
Nokia plans to adjust its manufacturing capacity and renew its manufacturing operations to better serve its global network of customers, partners and suppliers in the following manner:
- Focus its feature phone manufacturing on those locations with optimal proximity to suppliers and key markets. As a result, Nokia plans to close its manufacturing facility in Cluj, Romania by the end of 2011, as Nokia’s high- volume Asian factories provide greater scale and proximity benefits.
- Review the long-term role of its manufacturing operations in Salo, Finland, Komarom, Hungary, and Reynosa, Mexico. These factories are expected to continue to play a key role in serving European and North American smartphone customers, but the plan is to gradually shift their focus to customer and market-specific software and sales package customization. It is estimated this would have an impact on the number of personnel in 2012, with no impact in 2011. Nokia will engage in discussions with employee representatives and stakeholders in these sites, and expects to have more visibility into the possible headcount impacts in the first quarter of 2012.
Nokia previously announced its plans to create a Location & Commerce business consolidating location assets including NAVTEQ and Nokia’s social location services operations. As part of consolidating this business, Nokia has identified potential synergies and opportunities to increase effectiveness through automation. Location & Commerce is responsible for driving the delivery of the world’s best digital mapping content, location platform and social- location experiences.
Nokia plans to concentrate its Location & Commerce development efforts in Berlin, Boston, Chicago and other supporting sites, and plans to close its operations in Bonn, Germany and Malvern, US.
Nokia is also starting consultations with employees in Sales, Marketing and Corporate Functions, in line with Nokia’s earlier announcement on April 27, 2011.
“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.
The planned closure of the Cluj factory combined with adjustments to supply chain operations is estimated to impact approximately 2,200 employees. The planned changes in the Location & Commerce business are estimated to impact approximately 1,300 employees. These personnel reductions are in addition to the measures announced in April and are expected to take effect by the end of 2012.
In line with the company values, Nokia will offer employees affected by the planned reductions a comprehensive support program. Nokia remains committed to supporting its employees and the local communities through this difficult change.
Nokia is committed to connecting people to what matters to them by combining advanced mobile technology with personalized services. More than 1.3 billion people connect to one another with a Nokia, from our most affordable voice- optimized mobile phones to advanced Internet-connected smartphones sold in virtually every market in the world. Through our services, people also enjoy access to maps and navigation on mobile, a rapidly expanding applications store, a growing catalog of digital music, and more. Nokia’s NAVTEQ is a leader in comprehensive digital mapping and navigation services, and Nokia Siemens Networks is one of the leading providers of telecommunications infrastructure hardware, software and professional services globally.