Nokia cutting 3,500 jobs, closing their factory in Romania [Asia is a better place to build devices]

unemployed

Nokia just issued a press release hilariously titled “Nokia continues to align its workforce and operations“. They waste the first 9 paragraphs patting themselves on the back for the new strategy they’re taking now that Stephen Elop is at the helm before finally getting to the point. Nokia’s factory in Romania will be shut down by the end of the year, meaning 2,200 people will lose their jobs. Nokia will also be “consolidating location assets”, otherwise known as the folks who work for on the mapping stuff, which will result in a further 1,300 job cuts. That’s 3,500 people without a job, on top of the 7,000 Nokia said they’d cut in April. Eldar Murtazin, Editor of Mobile-Review, also revealed to us in a Twitter conversation that Nokia’s plant in Hungary will be the next one to shut down.

Does any of this really come as a surprise to you? Nokia’s losing their market share from all directions. From the high end there’s iOS and Android. From the midrange there’s again, Android. And from the low end there’s not only Samsung, but a bunch of brands no one has ever heard of, mostly from China, that are making devices at prices Nokia simply can’t match. The only logical thing to do then is to reduce the number of factories. Nokia’s press release specifically stated: “Nokia’s high-volume Asian factories provide greater scale and proximity benefits.” Why pay a European a higher salary when you can just pay an Asian less and then ship devices over on a boat or plane?

All this being said, owning the factories that make your mobile devices isn’t really that big of a deal. Apple doesn’t own Foxconn or Quanta, yet they make a majority of their products. Rumors even suggest that Nokia’s first Windows Phones are going to be built by Compal!

Remember “Made in Finland” used to mean something to hardcore Nokia fans?

  • Anonymous

    Surname Romanian?…Hmmmm.

    In any event, looks like a smart move given the portfolio needed to be consolidated; something Elop clearly understands.  What’s left are the most productive factories; one’s  that can deliver both quality and scale.

    • http://www.intomobile.com/ Stefan Constantinescu

      Yes, I have a Romanian surname, but I hold an American passport and haven’t visited the “old country” for 10+ years. I’ve got no allegiance. None.

    • http://www.intomobile.com/ Stefan Constantinescu

      Yes, I have a Romanian surname, but I hold an American passport and haven’t visited the “old country” for 10+ years. I’ve got no allegiance. None.

  • Anonymous

    Surname Romanian?…Hmmmm.

    In any event, looks like a smart move given the portfolio needed to be consolidated; something Elop clearly understands.  What’s left are the most productive factories; one’s  that can deliver both quality and scale.

  • Anonymous

    Too bad, I’m sure Romanians could use the jobs and Nokia could use the sales.

  • Anonymous

    Too bad, I’m sure Romanians could use the jobs and Nokia could use the sales.

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