Downsizing by Nokia leads to hundreds of leased company cars being returned to be sold as used vehicles
The most popular wheels among Nokia employees have been Skodas, Volkswagens and Volvos
The travails of a major player in the mobile phone market are being felt in another area of mobility: dismissals by Nokia in the Finnish cities of Oulu, Tampere, Salo, as well as in the capital area are leading to early returns of hundreds of leased cars in the middle of the contract period.
The first cars that were leased by former Nokia employees are already being offered for sale, for example, at this showroom in Oulu.
Car mechanic Jussi Tuomaala is straightening a dent in the door of a returned BMW at the ADL second-hand car dealership in Oulu.
With the right implements, the dent is straightened quickly and handily, but what would be the tools to fix the cracks in the hearts of the former staff of once-mighty Nokia?
In recent days, hundreds of Nokia workers have received notice of termination.
This has also marked the end of the company car benefit. Many of the 700 Nokia workers that are being dismissed in Oulu have enjoyed the benefit of driving a leased company car.
In Salo, 780 jobs will be cut. In Tampere the figure will be between 200 and 400. In Espoo, the number of workers to be made redundant will be specified only in a week’s time.
”The situation is difficult, for in many families a car is a necessity. On the other hand, the cancellation of the leasing contract will also put a stop to the compulsory monthly charges”, says Mikko Merihaara, the shop steward of the managerial employees at Nokia in Oulu.
“Most of the cars for which the leasing contract has been terminated will be sold. Only in the case of those vehicles that have been driven very little is a further leasing contract possible”, explains director Kari Kauppinen from the ADL leasing department.
Kauppinen is unable to say precisely how many leasing cars will be returned to ALD, but the figure will be in the hundreds. According to Kauppinen, Nokia has acquired most of its company cars through ALD.
“A typical Nokia employee uses a low-emission car, the monthly charges of which are not too high. The favourite makes have been Skoda, Volkswagen, and Volvo”, Kauppinen knows to say.
The service leasing fee for a typical family car is around EUR 500 per month, over three to five years. The user also pays insurance, annual vehicle tax, and fuel costs.
”The employee is not penalised for the breaking of the contract, as Nokia pays the agreed compensation. Cars have been returned before, for example, in connection with an employee changing jobs”, Kauppinen adds.
The dismissed employee can also elect to purchase his leasing car. This is what graduate engineer Antti Kiiveri did after Nokia made him redundant.
“It was a safe enough option. I knew the car’s service history for the past four years”, Kiiveri says.
In the autumn Kiiveri will start a new job as a project manager with Oulu-based Codenomicon.
According to Kauppinen, the lease cancellation rush that will peak in the autumn happened at a good time, for there is a shortage of lightly driven cars in the market.
“Many buyers are interested in them. The sales figures of new cars, in turn, are heading down”, Kauppinen explains.
Previously in HS International Edition:
For Oulu, Nokia´s years of growth are over (8.8.2012)
Nokia eliminating up to 10,000 jobs in cost-cutting move (14.6.2012)
Accenture beginning to reduce staff from Symbian development (10.5.2012)
Union leaders fear Nokia may leave Finland (15.6.2012)
Vehicle leasing (Wikipedia)