Nokia Cuts 3,500 Jobs

Closes factories in Romania, Germany, and the U.S.

Finnish phone maker Nokia is cutting 3,500 manufacturing jobs in an effort to save costs. It is the latest round of layoffs for the company, which axed 6,800 research and development jobs earlier this year.

Nokia has seen a significant drop in its global market share this year, in the face of growing competition from Apple and Android smartphones. The AFP reports that Nokia’s market share fell to around 23 percent in the second quarter of this year, compared with a peak of 40 percent in the first half of 2008. The New York Times adds that the company made a €368 million loss ($502 million) in the second quarter of 2011.

The company will close a factory in Cluj, Romania, by the end of 2011, and plans to end operations in Bonn, Germany, and Malverne, N.Y. It is also “reviewing” manufacturing operations in Finland, Hungary, and Mexico.

The cuts are apparently part of an effort to streamline operations, shift production to Asia, and strengthen an alliance with Microsoft, which will run the Windows operating system in all new Nokia smartphones.

Nokia president and CEO, Stephen Elop, says the cuts will make Nokia “a more dynamic, nimble and efficient challenger."

"We must take painful, yet necessary, steps to align our workforce and operations with our path forward," he said in a statement.

In August, Nokia split from Wieden + Kennedy, which had handled the phone company’s advertising account for four years, as reported in Adweek.

Publish date: September 30, 2011 © 2020 Adweek, LLC. - All Rights Reserved and NOT FOR REPRINT