M-real and Elcoteq to cut more than 1,000 jobs in Finland

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The financially strapped paper manufacturer M-real announced on Tuesday that it will reduce its workforce in Finland by 600 people. The company does not plan to shut down entire factories. Instead, jobs will be trimmed at a number of mills around Finland.
      Meanwhile, mobile telephone subcontractor Elcoteq is planning personnel cuts of 500. The company is considering completely shutting down its only production facility in Finland.
      The latest planned mass redundancies come hot on the heels of an announcement by mobile telephone cover manufacturer Perlos that it was shedding over 1,000 jobs at its plants in North Karelia.
     
The aim of M-real’s cutbacks is to improve the company’s result by EUR 40 million. The company has shut down entire paper mills in other countries. This will not happen in Finland. Instead, staff will be reduced at production facilities in different parts of the country.
      Employees took the news fairly calmly.
      Pentti Villanen, deputy head shop steward at M-real’s Kemi plant, said that he expects negotiations with management to bring a positive result.
      Paperworkers’ Union president Jouko Ahonen was also pleased that no manufacturing facilities would be closed down. He predicted that the announcement would not result in any employee walkouts.
      Meanwhile, M-real surprised observers by announcing that Juha Niemelä, former CEO of UPM, would join the Board of Directors of M-real. He is to bring forest industry expertise to a board mainly comprising forest owners and bankers.
     
Elcoteq’s planned job cuts mean that the company could shut down all manufacturing in Finland. This means that the company’s factory in Lohja will probably be closed down.
      Elcoteq employs about 23,000 people around the world, approximately 700 of whom are in Finland. In addition to factory workers, there is personnel in product development and planning.
      In December Elcoteq announced that it would move its headquarters from Finland to Luxembourg, and would embark on a cost-cutting programme aimed at annual savings of about EUR 20 million.
      Last year, Elcoteq’s turnover increased by three percent to EUR 4.2 billion. Profit was EUR 43.9 million, for the whole year, although in the fourth quarter, the balance went into the red.


Previously in HS International Edition:
  Perlos employees stage walkout to protest planned closure (17.1.2007)
  Perlos plans to shut down manufacturing in Finland - 1,200 jobs to go (16.1.2007)

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