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© stephen-vanhorn-dreamstime.com General | October 09, 2013

Alcatel confirms 10'000 layoffs

Alcatel-Lucent has after media reports regarding the massive layoffs, issued an official statement, explaining the company's actions.
The Shift Plan also aims to restore profitability to the company, being based on a transformation of Alcatel-Lucent’s R&D activities for greater efficiency and a reallocation of resources to focus on future technologies while making a significant reduction of fixed costs. As part of the Shift Plan, the company will make key social actions in order to restore its competitiveness in the marketplace, the company states in the press release.

As previously stated, the company plans to cut cost and achieve cost savings of EUR 1 billion by 2015. To do this the company will take these measures:
Reallocating R&D investment to next-generation technologies which should represent 85% of R&D spend in 2015, as opposed to 65% today.
Reducing R&D spend in legacy technologies by 60%.
Reducing administrative, sales and support functions to bring SG&A costs in line with industry standards.

Michel Combes, CEO of Alcatel-Lucent said: "We launched The Shift Plan in June to give Alcatel-Lucent an industrially sustainable future. The strategic choices we made have been validated by our customers. 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."

The company will inform its European works council (ECID), about the planed headcount reduction of approximately 10'000 employees by the end of 2015. All geographic areas where Alcatel-Lucent operates will be affected, with the reduction of 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 industrial transformation will focus R&D activities on future technologies such as 4G and IP platforms, in particular with the creation of a new small cells competency center. France will keep its focus on optics and strengthen it in mathematics, at the heart of next-generation network software, the press release continues.

Business activities in France dealing with service providers will be concentrated in two main sites – Villarceaux, south of Paris, which will become Alcatel-Lucent’s primary R&D center in Europe, and Lannion, which will specialize in ultra-broadband mobile access and subscriber data management (SDM) technologies.

In France, the company intends to reduce approximately 900 positions in 2014 primarily in support, administrative and sales functions (via a legally-compliant program know in France as Plan de Sauvegarde pour l’Emploi), as well as recruiting 200 engineers and technicians with new technical competencies.

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

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