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Sony Ericsson and ST-Ericsson axe 800

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Sony Ericsson and ST-Ericsson axe 800
13:56 CEST+02:00
An estimated 800 people are set to lose their jobs in Lund in southern Sweden as mobile phone maker Sony Ericsson and wireless technologies firm ST-Ericsson announce new staff cutbacks.

Both full time staff and consultants are to be affected by the lay-offs.

Sony Ericsson announced plans in mid-April to slash 2,000 jobs worldwide after posting a loss of €293 million ($384 million) in the first quarter of 2009.

160 Sony Ericsson employees in Lund were given notice of redundancy on Friday. A further 150 consultants are also being forced to leave, on top of the 100 consultants who already left in April, the company said.

Sony Ericsson also warned that further redundancies were to be expected in Sweden.

Local media in southern Sweden further reported that ST-Ericsson plans to fire some 400 members of staff, most of whom are located in Lund.

ST-Ericsson was formed earlier this year as a merger between Ericsson Mobile Platforms and ST-NXP Wireless.

"There was talk of 2,000 after the quarterly report and Lund makes up almost half the global workforce. So 400 is maybe at the lower end of the calculations," said Ulf Bengtsson, chairman of the Swedish Association of Graduate Engineers and head of the organisation's local chapter in Lund.

"But the entire situation is threatening. We had a first quarter that cost us 35 million kronor ($4.5 million) a day if my mental calculations are correct, and things won't be good unless we can alter that development," he added.

Bringing down wage costs was not the answer, said Bengtsson.

"All the company's employees could work for free and we would still be running a loss. So we have to bring down our production and component costs, while also seeing a rise in volumes."

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