Alcatel-Lucent To Cut 10,000 Jobs As Restructuring Continues

(RTTNews) - Confirming media reports, French telecom equipment maker Alcatel-Lucent (ALU) Tuesday said it plans to reduce about 10,000 jobs globally by the end of 2015, as part of the plan announced in June.

On June 19, Alcatel-Lucent had revealed a three-year plan called "The Shift Plan", aimed at repositioning the company as a specialist provider of IP Networking and Ultra-Broadband Access. The plan targets 1 billion euros in fixed cost savings and asset sales of more than 1 billion euros over 2013-2015.

Alcatel-Lucent, created in 2006 by the merger of France's Alcatel and Lucent Technologies of the U.S., has been reporting weak results due to tepid wireless segment revenues. The company is trying to cope with rapid customer migration from CDMA to 4G LTE services, particularly in North America, and grappling with continued market uncertainties in Europe.

The company will inform its European works council or ECID today of the planned job cuts. All geographic areas where the firm operates will be part of this decision. The company will reduce 4,100 positions in Europe, Middle East and Africa, 3,800 in Asia Pacific and 2,100 in Americas. By the end of 2015, Alcatel-Lucent will halve the number of its business hubs globally.

In France, the company plans to reduce about 900 positions in 2014 primarily in support, administrative and sales functions, while recruiting 200 engineers and technicians with new technical competencies.

By the end of 2015, the company transformation program could also lead to internal mobility, transfers to partners and redeployments for around 900 employees whose jobs will be retained, inside or outside the company.

Michel Combes, CEO, said, "...To carry out this plan we must make difficult decisions and we will make them with open and transparent dialogue with our employees and their representatives. The Shift Plan is about the company regaining control of its destiny." Alcatel Lucent's industrial transformation in France will focus R&D activities on future technologies such as 4G and IP platforms, particularly with the creation of a new small cells competency center. As far as research is concerned, France will keep its focus on optics and strengthen it in mathematics.

Business activities in France dealing with service providers will be concentrated in two main sites - Villarceaux and Lannion.

Villarceaux, south of Paris, will become Alcatel-Lucent's primary R&D center in Europe and one of the world's largest R&D campuses. Lannion will specialize in ultra-broadband mobile access and subscriber data management or SDM technologies.

The stock was gaining 1.4 percent in early morning trading in Paris at 2.93 euros.