Ericsson to Cut 354 Jobs as It Shutters Swedish Cable Business
Ericsson said the closing would mainly impact facilities in Stockholm and in Hudiksvall, a city on the east coast of Sweden, with a total of 354 workers to be made redundant. The company, based in the Swedish capital, said global production has shifted toward Asia, where the majority of the business volume for fiber cable are found. In Europe, there is more output than demand for copper and fiber cables, Ericsson said.
“There is overproduction on the cable market in Europe,” Tomas Qvist, Ericsson’s head of special products in the networks business and head of human resources in Sweden, said in a statement. “Unfortunately, our production has not been operating at full capacity for a long time and has struggled with profitability.”
Ericsson said net sales for its telecom cables was about 1 billion kronor ($150 million) last year. The restructuring charges related to the closure will be about 500 million kronor and will be split between this quarter and the third quarter.
The manufacturer said in November it would cut 1,550 jobs in Sweden to make up for weak equipment spending from telecommunication operators.
Ericsson shares slipped 0.6 percent to 78.90 kronor at 3:26 p.m. in Stockholm, declining for the fourth day. That pared the advance to 21 percent this year.
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