Axe begins to fall at Nokia Siemens

Mega vendor Nokia Siemens Networks put a damper on things on Friday, when it revealed that it has started sharing its proposed headcount reduction plans with employees in both Finland and Germany.

Last year, the company said that it expected to adjust headcount by 10-15 per cent over a four year period from an initial base of approximately 60,000. Nokia Siemens confirmed today that it expects its adjustment to remain within that range, at approximately 9,000 employees.

In order to preserve jobs, some of the planned reductions are expected to see the transfer of personnel to R&D, manufacturing and other partners of Nokia Siemens Networks.

The previously announced cost synergy targets of Eur1.5bn annually by the end 2010 remain unchanged.

Nokia Siemens 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 initial 700.

In Germany, the company will start consultations related to the proposed adjustment of 2,800 to 2,900 employees between now and the end of 2010.

“This is a necessary step to build a Nokia Siemens Networks able to compete now and in the future,” said Simon Beresford-Wylie, chief executive officer of Nokia Siemens Networks.

“I know that the planned actions announced today will be difficult for some, but it is our responsibility to create a winning company that can provide strong future opportunities for employees, adequate returns for our shareholders, and cost-competitive products, services and solutions for our customers. While we are a global company, with more than sixty percent of our employees already outside of Finland and Germany, both Finland and Germany will continue to be major centers of employment for Nokia Siemens Networks.”

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