Nokia Siemens Networks to cut 9,000 jobs

Telecoms equipment maker Nokia Siemens Networks plans to cut 9,000 jobs or 15 percent of its global workforce by the end of 2010 in an effort to boost its competitiveness in the increasingly cut-throat sector.
The group, which previously said it would cut 10 to 15 percent of its staff, said on Friday it had begun talks with staff representatives in Germany and Finland where about half of the cuts will fall.
The company, a venture between Nokia Oyj and Siemens AG which started operations last month, repeated it aimed to achieve annual savings of 1.5 billion euros ($2 billion) as it competes for increasingly scarce business amid slowing spending by telecoms operators.
In Germany, Nokia Siemens Networks aims to cut 2,800 to 2,900 jobs by the end of 2010 from 13,000 now, while in Finland 1,500 to 1,700 jobs would go from a total of 10,000.
Jobs would also be cut in other countries, the company said, without elaborating. Hundreds of people walked out at the new company headquarters in suburban Helsinki after the job cut plans were unveiled, said union representative Pentti Arpalahti. "The feeling is terrible, even though we have waited for the announcement," Arpalahti said. "People are partially shocked, but there is also resistance rising.
A spokesman for German trade union IG Metall said the union had requested more information and protests were not ruled out.
Harri Kolula, senior employment relations official at Finland's Union of Salaried Employees, said: "As we are talking about a financially stable company, lay-offs should be avoided. Moving people to new positions within the company must be the primary aim."
Nokia Siemens Networks, which recorded 2006 pro-forma revenues of 17.1 billion euros, aims to challenge the top industry players, such as Sweden's Ericsson, which leads the market in mobile infrastructure.
The new group trimmed its forecast for the telecoms infrastructure market in April, saying it would grow only very slightly in euro terms this year.
"Many of our customers are facing intense cost pressure, relentless competition, and new business models," Christoph Caselitz, the firm's chief marketing officer, said in a statement on Friday.
Nokia and Siemens merged their networks business partly to be able to better weather periods of slow growth by sharing high fixed research and development costs and reducing overheads.
Nokia said last month it plans to book significant restructuring charges in the second quarter, with 75 percent of the total cost of 1.5 billion euros which owners will book incurring by April 2009.