Helsinki (AFP)
Nokia plans to cut 5,000 to 10,000 jobs within two years, or up to 11% of its workforce, as part of a major cost-cutting plan, Finnish telecom equipment manufacturer announced on Tuesday.
This restructuring is to result in a group of "80,000 to 85,000 employees within 18 to 24 months, against around 90,000 at Nokia today. The exact number will depend on the evolution of the market in the next two years", writes the company in a press release.
After the takeover of its French-Canadian competitor Alcatel-Lucent in 2016, the group's workforce, which in 2013 left its historic mobile phone manufacturing activity, had risen above 100,000.
Workforce reductions and significant cost reductions are already underway, especially in France, where Nokia is painfully cutting a thousand jobs inherited from Alcatel-Lucent.
World number 3 in fifth generation 5G networks, the group led since August by Pekka Lundmark is struggling to stay in contact with its main competitors, the Swedish Ericsson and especially the Chinese Huawei.
"Decisions that have a potential impact on our employees are never taken lightly. Ensuring that we have the right set-up and the right capabilities is a necessary step to provide long-term sustainable performance," argued in the press release the CEO, who has made 5G Nokia's top priority.
The plan announced Tuesday should lead to lower Nokia costs "of around 600 million euros by the end of 2023", intended to finance investments in research and development and "future capacities" explains the Finnish group.
It follows the already announced reorganization of the group into four branches of activity.
Nokia, which suffered a heavy loss in 2020 linked to an exceptional load in Finland, warned last month that it expected "headwinds" in 2021, especially in 5G in North America.
Restructuring costs should be around 600 to 700 million euros, again by 2023, says Nokia.
The group must detail its strategy Thursday during a presentation day to investors.
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