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Monday, May 19, 2008

Nokia shuts down its German plant

Because of excessive labor cost, Nokia Coporation had to shut down its last operating plant in Germany. The plant situated at Bochum in Germany finished its production on last Friday. The factory will officially shutdown in June. The 2300 employees of the company received their official termination letters. For cleaning the company, dismantling the machineries, 150 employees will work at the factory. Nokia made the factory shutdown announcement in the mid-January which started a series of protest. Top German politicians also blamed the company. Helsingin Sanomat :

Production has been transferred to the Nokia plant in Komárom in Hungary, as well as a brand-new production facility in Cluj, Romania.

Nokia says that the closure of Bochum took place in a controlled manner, and the desired mobile phone manufacturing capacity has come from other plants. The Cluj plant is not yet operating at full capacity, Nokia says.

The closure of the Bochum plant proved expensive for Nokia, which now has to pay out EUR 185 million in severance pay alone. In addition, EUR 15 million will be needed to run a training centre, or so-called transfer company, for the employees losing their jobs.

The centre is to employ and train employees for up to a year as of early July.

Out of the 2300 employees of the plant, about 200 got new jobs. The highly educated employees did not face much problem in finding new jobs. Some of the employees are now working in the Canadian mobile communications company RIM.

Related article:
Helsingin Sanomat


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