The scramble continues among mobile-phone makers.
this morning said it was cutting 2,100 jobs in Sweden and halting production at two British plants as part of a cost-cutting measure that would slash annual costs by at least 20 billion crowns ($1.96 billion) beginning in 2002.
Shares of the company were rising 3.8% to $5.94 in preopen trading on electronic brokerage
Today's announcement by Sweden's Ericsson, the largest producer of mobile networks and the third largest supplier of handsets, follows the company's
earnings warning two weeks ago. And it comes amid a host of similar announcements by beleaguered rivals
eliminated another 4,000 jobs last Friday.
Finnish giant Nokia today said it was cutting 300 to 400 jobs in its networks unit as the company streamlines its broadband systems unit.
Citing the "slower-than-expected growth in the economy, the telecommunications industry and particularly the mobile-phones business," Ericsson said it would reduce its workforce in Kumla, Sweden, from 3,200 workers to 1,700 workers. In its Linkoping, Sweden, plant, where work will soon be outsourced to
, the company will cut its headcount by 600 people. And mobile-phone production will be halted effective as of the third quarter of this year in U.K. plants in Carlton and Scunthorpe, where 1,200 people are employed. Ericsson said a search for a new owner of the plants is ongoing.
"In today's uncertain state of the economy with negative signals, Ericsson must react, and we are now taking necessary measures. We have to drive efficiency much harder, with the dedication to become more competitive than ever before," Ericsson said in a prepared statement announcing the changes. The company has also implemented a hiring freeze and cut the number of external consultants it uses.
According to a report by
, Ericsson this morning denied speculation that its chief executive, Kurt Hellstrom, was resigning.