It’s a sign of the times, though not a particularly surprising one: Nokia has finally eliminated its European phone assembly infrastructure and will be moving those 4000 jobs to Asia, according to a Reuters report. The factories are not being shuttered altogether, and localizing and finishing work will still be done there, but the primary assembly work is being relocated.
The news and layoffs were expected, as the company has slashed many more thousands of jobs over the last year, but this particular cut is symbolic: the intensely European company has been battered into submission, and will join the others in the now-standard configuration of “design here, build there.”
The job losses are 2300 in Hungary, 1000 in Finland, and 700 in Mexico. They don’t represent all of Nokia’s employees in those countries, just those involved with basic assembly. Nokia did not say where or to what contractor the jobs would be sent, but considering their need to cut costs, the majors in China, Taiwan, Thailand, and others in the area are the natural choice.
Naturally, the countries losing the jobs expressed disappointment, but Nokia’s got to do what Nokia’s got to do, and these job losses have been telegraphed for some time. It’s likely that they were announced today only after extensive negotiations with unions and local contractors.
Whether this approach will prove effective at lowering costs without damaging the company or brand is yet to be seen; it may be that saving money on manufacturing might not be enough to counter the enormous drop in sales Nokia has seen over the last two years.