Finnish cell phones finished

Michael Fitzgerald By Michael Fitzgerald

“Made in Finland” once held cachet for cell phone buyers. But as Apple and Google have remade the market for mobile phones, Finland’s Nokia has floundered. Now, it will no longer even make phones in its home country.

Walking papers. Nokia workers in Komarom, Hungary, head home after a shift. 2,300 lost jobs Wednesday. (Reuters/Laszlo Balogh)

Nokia said it would stop making phones at its plant in Salo, Finland, as well as plants in Reynosa, Mexico and Komarom, Hungary. Last year it stopped production at a plant in Romania. Wednesday’s announcement means it will stop making cell phones on its home continent, or indeed any continent outside of Asia. It also will cut 4,000 jobs.

Chief of Layoffs

In all, Nokia has cut nearly 15,000 jobs since it hired Stephen Elop, its first non-Finnish CEO, in September 2010. That’s not counting the 17,000 jobs slashed from its joint venture with Siemens, Nokia Siemens Networks. (See a timeline of Elop’s tenure).

While the cutting of production in Salo is fraught with symbolism, Nokia’s Hungarian plant will lose the most jobs, 2,300. The plant in Salo will lose 1,000 workers, and 700 jobs will be cut in Mexico. All three factories made smart phones.

The shift comes at a time when Apple and other manufacturers face scrutiny for the conditions in their Asian factories.

One place in Asia that won’t benefit: Nokia’s existing plant in Chennai, which only manufactures basic mobile phones.  Instead, production will shift to Nokia plants in Beijing and Masan, Korea, a Nokia official told the Hindu Business Line.

Finland’s YLE reported that Finnish trade unions have condemned the cuts, and that Nokia has pledged to work with unions to help workers transition to new jobs. Salo and the other two factories will continue to employ people to help customize smart phones.

Straight to the Source

  • Guest

    It sad and impressive to see how Nokia, a company that enjoyed great profits from its mobile phone production business, just collapses within a quick few years when other companies, the smartphone regime, such as Apple and other Android companies take over. The change was a bit abrupt – I still remember seeing Nokia being popular when the first generation of iPhone came out. But it didn’t take Apple too long before it defeats Nokia. Seeing the change in the market, Nokia was willing to change, but it was too slow. The modification of its Symbian system and the introduction of the Windows Phone system did not really catch the market’s trend. This is perhaps because Nokia has enjoyed too much of its past and is therefore reluctant to change. In fact, it is tragic to see Kodak as its parallel – Kodak is a company that enjoyed great profits and success from its traditional film business, but as the digital cameras gradually took over, Kodak was a bit slow to respond. From Nokia’s story and that of Kodak, we have to say that a glorious past can become a hindrance for the present, but there is little we can do about it – pride goes before a fall.

  • Michaelf

    Companies are sometimes able to come back from seeming defeat. Even Motorola had some bouncebacks in mobile phones, including the original RAZR phone. Nintendo was left for dead until it came out with the Wii and the ds, both of which vaulted it back into the forefront of video gaming. Apple itself looked headed for bankruptcy until it was revitalized, in part through making a deal with Microsoft. It’s too early to say that Nokia is doomed, but it does face a lot of trouble.