Alcatel-Lucent Outlines 5,500 Job Cuts

Telecoms firm Alcatel-Lucent outlined plans to cut around 5,500 jobs by the end of 2013, as it looks to make savings of around €1.25 billion.

The company held a meeting with union representatives yesterday, noting that 3,340 jobs will go in the EMEA region, and around 1,000 each for the Asia-Pacific and the Americas areas, an Alcatel-Lucent spokesperson told TechWeekEurope. It was initially thought 5,000 positions would be lost.

The job cuts will mainly take place in general administration and support functions. Further details on how many places will be lost in the UK are set to be announced in the coming months, the spokesperson said.

Road to recovery for Alcatel-Lucent

It forms part of a strategic review of the business, which has been going through a turbulent period, as companies cut back on telecoms spending and firms like Huawei offer greater competition.

In July,  Alcatel-Lucent announced plans to save €1.25 billion and return to its main strengths, namely core networking, fixed networks, wireless and software platforms for managing networks.

The company also appointed a new chief operating officer, the CFO Paul Tufano, to focus on achieving efficiencies across the supply chain and in procurement.

“The objective of the new operating structure is to strengthen Alcatel-Lucent’s presence in key telecommunications products and services through a unified business group,” said CEO Ben Verwaayen last month.

That was after the company revealed a net loss of €254 million in the second quarter.

Alcatel-Lucent  remains committed to spending on R&D, however, and the spokesperson said it would continue to invest a “significant proportion revenue” in that area.

“We need to make sure we are in step or ahead of market realities,” the spokesperson added.