* To cut assembly jobs in Finland, Hungary, Mexico
* Moves smartphone assembly to Asia
* Shares 1.2 pct higher
By Tarmo Virki, European Technology Correspondent
HELSINKI, Feb 8 Struggling Finnish phone maker
Nokia plans to cut 4,000 more jobs at its plants in
Finland, Hungary and Mexico as it seeks to cut costs by moving
smartphone assembly work to Asia.
The cuts of 8 percent of the phone business workforce bring
total planned job cuts at the group since Stephen Elop took over
as Chief Executive in September 2010 to more than
Nokia said in a statement the job cuts would take place in
phases through this year. It has been reviewing the operations
since unveiling the closure of its Romania plant last
"This was inevitable. It was a surprise it took so long for
the decision to be made," said Steve Brazier, chief executive of
technology research firm Canalys. "Stephen Elop may be a
polarising figure, but he is proving effective at driving the
change and he should be credited for that".
Nokia's recent business results have underscored the need
for drastic cuts. Late last month it reported a 73 percent fall
in quarterly earnings as sales of new Windows Phones failed to
dent the dominance of Apple Inc's iPhone or compensate
for diving sales of its own old smartphones.
Its fourth-quarter smartphone sales shrank 31 percent from a
year ago and the business made a steep loss for the quarter.
NO MORE PHONES BUILT IN EUROPE
Nokia said it would cut 2,300 jobs in Hungary, where it is a
major exporter, some 1,000 in Finland and 700 in Mexico. It will
continue to tailor models for specific operators at all sites.
Its Finnish factory in Salo, which was the cornerstone for
its success in 1990s, has been the last remaining major phone
assembly plant in the Western Europe for some time .
Most rivals have moved their production to Asia.
The Hungarian government said it regretted Nokia's decision.
Analyst Gergely Suppan at Takarekbank in Budapest noted the
highest value-added activities would stay in Hungary.
The move comes only months after Nokia closed its plant in
neighbouring Romania, laying off some 2,200 people there.
Finnish unions demanded hefty cash payments to laid-off
staff and Antti Rinne, chief of union Pro, said the announcement
was damaging for Finland's employment outlook.
"Raising the employment level and prolonging working careers
is impossible if there are no jobs in Finland," Rinne said in a
Finland has pushed for years to prolong working careers as
the Nordic country struggles with a shrinking work force and
sluggish economic growth.
Nokia announced in April last year it would cut 7,000 jobs
and unveiled a further 3,500 job losses in September. Its
network arm Nokia Siemens announced cuts of 17,000 in November.
The group had 130,000 staff at the end of 2011, including
Shares in Nokia were 1.2 percent higher at 3.93 euros,
slightly outperforming the technology share index which rose 0.3
percent, by 1053 GMT.