Nokia to close German plant, lay off workers

Mobile phone maker Nokia Corp. announced today that it will lay off 2,300 employees at a German plant and move production to lower-cost European sites.

Espoo, Finland-based Nokia plans to close the plant in Bochum, Germany, by midyear. It also plans to close an automotive business there and is negotiating with Sasken Technologies to sell a Bochum-based software research and development entity, according to a news release.

The Bochum site was not "globally competitive" and additional investments would not make it competitive. Nokia said.

Nokia announced last March that it was opening a manufacturing plant in Romania. The company also has a plant in Hungary.

Market changes and "increasing requirements for cost-effectiveness" mean that "production of mobile devices in Germany is no longer feasible for Nokia," Veli Sundbäck, a Nokia executive vice president, said in the statement. "It cannot be operated in a way that meets the requirements for global cost efficiency and for flexible capacity growth. Therefore we have to make this tough decision."

Nokia will negotiate with employee representatives to "reach a satisfactory solution" for everyone involved, the company said.

Copyright © 2008 IDG Communications, Inc.

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