Finnish mobile communication consumer products manufacturer Nokia Corp. will lay off 10,000 jobs globally and close plants by the end of 2013, reports Associated Press. According to the reports, the company informed the same on June 14, in a further drive to save costs.
Analaysts claim that the cuts mean that it will close some research and development projects, including those in Ulm, Germany, and Burnaby, Canada.
Nokia also reportedly said that it will close the manufacturing plant in Salo, but will keep its research and development operations there.
Nokia is fighting fierce competition from Apple Inc.'s iPhone and other makers using Google Inc.'s popular Android software, including Samsung Electronics Co. and HTC of Taiwan. It is also being squeezed in the low-end by Asian manufacturers making cheaper phones, such as China's ZTE.
Although it plans "to significantly reduce its operating expenses", Nokia says it will focus on smartphones and feature phones and intends to expand location-based services.
Further few reports have suggested that Nokia officials also quoted that "competitive industry dynamics" in the second quarter would hit its smartphone sector to a "somewhat greater extent than previously expected" and that no improvement was expected in the third quarter.
"Nokia is significantly increasing its cost reduction target for devices and services in support of the streamlined strategy announced today," said CFO Timo Ihamuotila in the AP reports. "With these planned actions, we believe our devices (and) services business has a clear path to profitability. Nokia intends to maintain its strong financial position while proceeding aggressively with actions aimed at creating shareholder value."
Last year, Nokia announced more than 10,000 layoffs, aimed at cutting operating expenses by €1 billion ($1.31 billion) by 2013.
Additionally, the company announced in its press release today, that Nokia has appointed Juha Putkiranta as executive vice president of operations; Timo Toikkanen as executive vice president of Mobile Phones, Chris Weber as executive vice president of sales and marketing; Tuula Rytila as senior vice president and chief marketing officer and Susan Sheehan as senior vice president of communications. Putkiranta, Toikkanen and Weber also will join the Nokia Leadership Team, effective July 1, 2012.
Formerly, Putkiranta was senior vice president, supply chain; Weber was senior vice president Markets, Americas, and Toikkanen was vice president, business development, programs and special projects.
Rytila, who will report to Weber, was formerly senior vice president of portfolio and business management and Sheehan, who reports to Elop, was vice president of communications.
Nokia also announced the following executives are stepping down from the Nokia Leadership Team effective June 30, 2012, to pursue other opportunities outside of Nokia: Jerri DeVard, executive vice president and chief marketing officer; Mary McDowell, executive vice president of Mobile Phones; and Niklas Savander, executive vice president of Markets.
DeVard, who joined the company in January 2011, led Nokia's marketing and brand management and served as a member of the Nokia Leadership Team.
McDowell has held a number of senior management positions at Nokia, including serving on the NAVTEQ board of directors, and most recently led Nokia's global mobile phones business unit. She has served as a member of the Nokia Leadership Team since joining the company in 2004.
Since 1997, Savander has held a number of senior management positions at Nokia and Nokia Networks, including serving on the NAVTEQ Board of Directors and the Nokia Siemens Networks Board of Directors. Most recently, Savander led Nokia's sales, marketing, supply chain, manufacturing operations and information technology teams and has served as a member of the Nokia Leadership team since 2006. Savander also will step down from the Nokia Siemens Network Board of Directors, effective June 30, 2012.
DeVard, McDowell and Savander will serve as senior advisors to Nokia through the transition of their roles.
