NOKIA WILL cut about 4,000 jobs at its smartphone manufacturing bases in Europe and the Americas after announcing plans to shift production to Asia.
The three factories affected are in Finland, Hungary and Mexico, although part of the operations will remain open to customise smartphones for the regional markets following assembly in Asia.
The Finnish phone maker said there were no plans for more workers in Asia, with the assembly work to be transferred to its factories in South Korea and Beijing in China.
Smartphone shipments at Nokia fell by about a third in the fourth quarter to 19.6 million compared with a year previously.
The initial sales of a Windows phone range introduced in certain markets in the past few months failed to counter a steep drop in its Symbian-based devices that are being phased out by 2016.
Nokia has shipped one million handsets using the Windows platform since its launch in October.
Nokia said the Asia move would increase competitiveness in the global device market, with the majority of its component suppliers based in the region. The Asian consumer is also important to Nokia given the company’s goal to provide internet-enabled handsets to the “next billion” emerging market customers.
The plan does not include any culling at its Finnish research and design laboratories, which employ 3,500 staff. The move will be particularly unwelcome in Finland, where Nokia has its headquarters.
It will also remind investors that the group remains close to, if not still on, the “burning platform” that Stephen Elop, chief executive, compared its predicament to this time last year shortly before announcing the Windows phone partnership with Microsoft.
Mr Elop said at its results last month that 2012 would be another year of transition. Including yesterday’s announcement, Nokia has made 14,000 job cuts since the end of 2010.
It was caught by surprise by the sudden popularity of high-price smartphones, in particular, on the back of Apple’s innovative iPhone. – (Copyright The Financial Times Limited 2012)
