|The Alcatel-Lucent Bell Labs in Villarceaux, France. (Bloomberg)|
Alcatel-Lucent SA plans to reduce staff by 10,000 as Chief Executive Officer Michel Combes moves forward with cost-reduction measures to turn around the unprofitable network-equipment maker, according to two people familiar with the matter.
That would eliminate about 14 percent of Alcatel-Lucent’s workforce worldwide, based on the 72,000 employees the company had as of December. Combes will discuss the cuts with union representatives Monday, they said, asking not to be named as the works council meeting ― a legal obligation in France for job cuts ― has yet to take place.
Alcatel-Lucent is following in the footsteps of competitor Nokia Oyj’s NSN wireless network gear division, which in late 2011 started a savings program to cut 17,000 positions, or about 23 percent of its total. The company has since cut more positions, in excess of 20,000 during the past two years. Pressure on equipment prices and slower investment from European carriers, along with competition from Asian rivals like Huawei Technologies Co., have forced telecommunications gear vendors to restructure.
Alcatel will cut 15,000 jobs as well as create 5,000 new posts, French daily newspaper Les Echos reported yesterday.
Alcatel-Lucent spokesman Simon Poulter declined to comment.
About a third of Alcatel’s employees are in Europe and a third in the Asia-Pacific region, according to the company’s website. A quarter are in the U.S., where Alcatel runs Nobel-prize winning research facility Bell Labs. (Bloomberg)