Following the $7.2 Billion acquisition by Microsoft, Nokia will suspend its manufacturing plant at Sriperumbudur near Chennai from November 1st this year. This happens as Microsoft has ended the mobile purchase agreement with Nokia. Nokia said that it will be informing all stakeholders including the Labour Commissioner of the suspension.

Nokia - The Writing is on the Wall
Nokia – The Writing is on the Wall

The manufacturing in Chennai had begun in January 2006 to export to the Middle East and Africa, Asia, Australia and New Zealand markets.  However, in March, the Tamil Nadu government had served a Rs 2,400 Crore notice on Nokia, saying the firm had also sold products from the Chennai plant in the domestic market instead of shipping them overseas. Also in a separate tax case, the Supreme Court had ordered Nokia India on March 14 to give a Rs 3,500 Crore guarantee before it transfers the plant to Microsoft.

Production at the unit has been dwindling, according to Nokia India Employees Union sources and had declined from 13 million handsets per month to 4 million per month in March this year. Majority of machinery was shifted to other manufacturing facilities of Nokia situated in countries like Vietnam.[source]

Nokia has provided voluntary retirement options to employees as well as a ‘Bridge initiative’ offering consultancy services and employment outlook training.

Also see : Yahoo is laying off bigtime in India.

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