Nokia Siemens Networks plans 9,000 job cuts

By Colleen Taylor, Contributing Editor -- Electronic News, 5/4/2007

Nokia Siemens Networks, an equally owned joint venture (JV) between mobile phone makers Nokia Corp.  and Siemens AG, today confirmed industry rumors that it is going through with plans to slash 9,000 jobs, or 15 percent of its workforce, worldwide over the next few years in a move it said is to "strengthen its competitive position in the communications industry."

The company, which has its operational headquarters in Helsinki, Finland, and regional headquarters in Munich, Germany, first mentioned the prospect of job cuts at its inception in June 2006. At that time, Nokia and Siemens said that Nokia Siemens Networks was expected to adjust its headcount by 10 percent to 15 percent over a four year period from an initial base of approximately 60,000.

The company said today it has now started sharing its proposed overall headcount reduction plans with employees and plans for Germany and Finland with employees and employee representatives. Actual reductions will begin within the next few months, the company said.

As a result of the plans, Nokia Siemens Networks said it is proposing reductions in Finland of 700 employees in the initial consultation process. By the end of 2010, the company expects an adjustment in Finland in the range of 1,500 to 1,700 employees, including the 700 in the initial consultation process, from an initial base of approximately 10,000. In Germany, the company said it will start consultations related to the proposed adjustment of 2,800 to 2,900 employees between now and the end of 2010 from an initial base of approximately 13,000. The company will also evaluate further adjustments in both countries related to the transfer of personnel to business partners.

Nokia Siemens Networks said it expects reductions in other countries where it has operations, and the company said that additional details will be announced as appropriate given country-level consultation processes.

Nokia Siemens Networks said that the planned headcount reduction is driven by the company's response to market conditions, including proposed changes to the product portfolio; site optimization; streamlining of various functions; strategic, long-term R&D and workforce balancing; and other factors.

"This is a necessary step to build a Nokia Siemens Networks able to compete now and in the future," Simon Beresford-Wylie, CEO of Nokia Siemens Networks, said in a statement.