Finnish telecom equipment maker Nokia is reportedly planning to lay off about 1,233 jobs at its French subsidiary Alcatel-Lucent International. The move is expected to affect a third of the company’s workforce.
The recent announcement from the 5G equipment maker comes in the wake of Europe’s transitioning to the 5G networks for mobile internet. The move is also a contradiction to Nokia’s statement to not cut jobs at the time of the company buyout.
When Nokia bought Alcatel-Lucent International, it pledged to preserve jobs in France for two years and to expand research and development teams in the country to create a resource within the group for 5G technology. French research and development teams are particularly affected by job cuts.
Nokia said in a statement that workforce reduction was done because of significant cost pressures. Nokia had earlier in April said that it aimed to cut costs by 500mn euros by the end of this year compared with full-year 2018, with 350mn euros targeted to come from operating expenses and 150mn from sales costs.
According to a Reuters report, Nokia might have to face political heat by the French government due to the move. “Nokia must improve this job cuts plan really significantly,” an official at the French finance ministry official said on condition of anonymity mention in the report.
Nokia became free from the commitments it made this month, a spokeswoman said, while the company’s president in France said Nokia would still be a big source of jobs.
“Nokia will continue to be a major employer in France with a strong foothold in R&D, sales and services, which will enable us to develop and execute our customers’ projects efficiently,” Thierry Boisnon, president of Nokia in France, said in written comments.
Nokia employs 5,138 people in France, of which 3,640 work for Alcatel-Lucent International.
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