With growth slowing and margins slipping, mobile-phone giant Nokia Oyj plans to shift some manufacturing to South Korea and Mexico from Fort Worth, Texas, and cut about 800 jobs, the company said Feb. 2.
The changes will impact the Fort Worth operations of plastics processors Perlos Oyj of Nurmijarvi, Finland; Triple S Plastics Inc. of Vicksburg, Mich., which is being acquired by Eimo Oyj; and InteSys Technologies Inc., a unit of Textron Inc.'s Gilbert, Ariz.-based Advanced Solutions group.
All have invested heavily and ramped up production to meet Nokia's needs.
Nokia will shift manufacturing from its Diplomacy Road/Centreport factory and sublease the site. Nokia has occupied the site since 1991 when it began production in the United States.
Nokia's larger Alliance factory, opened in 1995 in Fort Worth, will continue manufacturing mobile phones while focusing on more engineering support for the Western Hemisphere and fulfillment for the U.S. market.
Nokia, now employing 5,500 in the region, will consolidate all of its Fort Worth-based operations at the Alliance facility. The reduction in employment will occur over five months. A regional headquarters is located in Irving, Texas.
The Nurmijarvi-based firm has increased production during the past year, including plants in Mexico, Brazil and South Korea.
Nokia sold 128 million phones last year, up 64 percent from 1999, and estimated the global 2000 market at 405 million units. But Nokia is projecting slower growth and anticipating lower operating margins in 2001.
Nokia competes in mobile-phone production principally with Motorola Inc., which is closing a Harvard, Ill., site, and Telefon AB LM Ericsson, which is transferring its manufacturing to Flextronics International Ltd. April 1.