Nokia to close German plant, lay off workers

Nokia plans to close a manufacturing plant in Germany by mid-2008.

Mobile phone maker Nokia will lay off 2,300 employees at a German plant and move production to lower-cost European sites, the company announced Tuesday.

Nokia plans to close the plant in Bochum, Germany, by midyear. Nokia also plans to close an automotive business there and is negotiating with Sasken Technologies to sell a Bochum-based software research and development entity, the company said in a news release.

The Bochum site was not "globally competitive," Nokia said. Additional investments would not make the site competitive, the company said.

Nokia, based in Finland, announced last March that it was opening a manufacturing plant in Romania. The company also has a plant in Hungary.

Market changes and "increasing requirements for cost-effectiveness" mean that "production of mobile devices in Germany is no longer feasible for Nokia," Veli Sundbäck, executive vice president of Nokia, said in a statement. "It cannot be operated in a way that meets the requirements for global cost efficiency and for flexible capacity growth. Therefore we have to make this tough decision."

Nokia will negotiate with employee representatives to "reach a satisfactory solution" for everyone involved, the company said.

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