14 DAY TRIAL // Leading telecommunications solution provider Ericsson is set to cut a number of around 950 jobs in Sweden, in an effort to further reduce costs. The new job slashes will diminish the company's total workforce in the country by around 5 percent, and are determined by the closing of one of Ericsson's base station factories, namely the Gavle facility.
The said factory employs a number of 856 people, it seems, and the company will give the pink slip to 90 more people from the facility in Boras, the latest reports on the matter indicate. “We must reduce our production staff because the labour requirement for our products is diminishing as we increase efficiency,” Ericsson Chief Executive Carl-Henric Svanberg said in a statement.
Hans Vestberg, Ericsson's incoming chief executive, announced recently that the company needed to further perform cost-cutting actions, at least this is what a recent post on Financial Times suggests. Moreover, it seems that the new 950 job cuts in the company's home country are not part of the Ericsson's already unveiled plans to reduce its workforce so as to reduce its costs.
Previously, Ericsson announced that it planned on registering cost savings of around $1.4 billion, and that it should be able to reach that target before the middle of the next year. The said cost-cutting plans were also believed to involve the reduction of 5,000 jobs from the company, something that adds to the 4,000 job slashes the company announced during the last year.
At the end of September 2009, Ericsson was said to have a number of 82,500 employees. However, the newly revealed network management deal with the United States carrier Sprint Nextel added another 6,000 jobs to the equation. The Gavle factory that is being shut down makes base stations for 3G mobile networks, and it seems that the company's other facilities will be able to meet demand for these products.