Alcatel-Lucent to eliminate 1,000 jobs in India: report
15 Oct 2012
Alcatel-Lucent is planning to eliminate nearly 1,000 employees, as part of the Franco-American communications equipment maker's global restructuring plan to cut costs amid plunging sales, The Economic Times today reported, citing two senior executives aware of the matter.
The Paris-based company will axe around 9 per cent of its 7,000 strong workforce in its business support functions and its managed services vertical, which maintains and manages Reliance Communications' (RCOM) countrywide CDMA and GSM networks and Bharti Airtel's landline and broadband networks.
In July, Alcatel-Lucent, France's biggest phone-equipment supplier, said that it would reduce its headcount by 5,000 people or 6.4-per cent of its global workforce of 78,000, and exit or restructure unprofitable markets in order to cut costs by £1.25 billion ($1.5 billion) by the end of next year due to stiff competition and weak demand (See: Alcatel-Lucent to cut 5,000 jobs globally).
The company made the announcement as it released its second-quarter results, which showed net losses of 254 million euros.
However, the company has not specified the number of job cuts to be made in India since it still has to hold negotiations with its unions, but said that that the job cuts will not affect its 3,500-strong R&D employees spread across Bangalore, Chennai and Gurgaon.
Alcatel-Lucent Managed Solutions has a 67:33 joint venture with Reliance Communications to manage the telco's mobile networks. Most of the job cuts will come from this division since the ADAG group telco is planning to outsource the work to multiple vendors.
Alcatel-Lucent also has a 74:26 joint venture with Bharti Group to manage Airtel's landline network, and some job cuts could also come from this JV. "Managing and maintaining a pan-India fibre-optic network is both labour intensive and expensive since fibre-cuts are frequent," an executive told the ET.
Some reduction may also come from its other key managed services customer, Uninor, who recently decided to ramp down mobile operations in Kerala and Orissa, both being managed by Alcatel-Lucent since 2009.
(See: Alcatel-Lucent responds to reports on job cuts in India)
