Nokia plans 3,500 more job cuts

The Finnish handset manufacturer is to close down a Romanian factory plus location and commerce operations in Germany and the US, on top of the 4,000 job losses it already announced in April

Nokia is to cut a further 3,500 jobs on top of the 4,000 it revealed earlier this year, the company announced on Thursday.

Stephen Elop

Nokia boss Stephen Elop has announced 3,500 further job cuts worldwide. Photo credit: Nokia

The cuts will see 2,200 jobs go at Nokia's factory in Cluj, Romania, while 1,300 employees will be released as a result of the company's decision to close its Location & Commerce operations in Bonn, Germany, and Malvern in the US.

The Finnish firm's Location & Commerce efforts will now be concentrated in its Berlin, Boston and Chicago offices, the company said, adding that it would also "review the long-term role of its manufacturing operations in Salo, Finland, Komarom, Hungary, and Reynosa, Mexico".

"We must take painful, yet necessary, steps to align our workforce and operations with our path forward," Nokia chief executive Stephen Elop said in a statement. "Europe is core to Nokia's future. In addition to our headquarters, we have a strong R&D presence in Europe."

The cuts are separate to the 4,000 layoffs announced in April — 700 of which will take place in the UK. On that occasion, Elop said Nokia had "new clarity around our path forward, which is focused on our leadership across smart devices, mobile phones and future disruptions".

Worldwide cuts

The Unite union has vowed to fight the UK cuts. Nokia said on Thursday that it had was "starting consultations with employees in Sales, Marketing and Corporate Functions", relating to the 4,000 job losses.

The Romanian factory closure is apparently a result of the fact that Nokia's key markets for 'feature phones' — simpler handsets that do not have the app platforms of smartphones — are in Asia. "Nokia's high-volume Asian factories provide greater scale and proximity benefits," the company said.

The layoffs in Location & Commerce follow that unit's recent creation, which brings Navteq and other Nokia location businesses, along with the company's social location services business, into a single division.

As for the manufacturing jobs that may go in Finland, Hungary and Mexico, Nokia said these sites would 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 customisation".

In February 2010, Nokia also instituted round 285 job cuts at the Salo plant, ostensibly in an effort to "ensure production is focused fully on the high-value smartphone market, especially in Europe". Little more than a year before that, it closed its Turku site in Finland, shifting 220 employees to Salo.

However, these previous moves predated former Microsoft executive Elop's appointment as Nokia chief, and his subsequent decision to have Nokia drop its Symbian and MeeGo operating systems in favour of Microsoft's Windows Phone platform.

Meanwhile, on Thursday The Wall Street Journal reported that Nokia's internal efforts to develop a lightweight, Linux-based operating system, codenamed Meltemi, were still in motion. Nokia device chief Mary McDowell is leading the project, sources said.

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