Bangalore: US mobile phone maker Motorola Inc. has said its India operations will face job cuts as part of a plan to shed 3,000 jobs, or about 5% of its global workforce. The company did not specify the number of employees to be given pink slip in the country.
Trimming costs: Motorola Inc.’s headquarters in Schaumburg, Illinois. Tim Boyle / Bloomberg
“The decision (to lay off) is an in-principle worldwide one, to be implemented while evaluating a variety of factors for each market. At this time, there are no specifics,” said Amit Chaudhery, communications and corporate affairs head of Motorola India Pvt. Ltd
This comes a day after reports that American Express India, the local unit of New York-based card issuer American Express Co., is likely to cut 120-150 jobs from its finance and accounting back-office operation in India.
Several software engineers in Motorola India are being redeployed after Sanjay Jha, the company’s co-chief executive, in August decided to focus on Google Inc.’s Android operating system and just two other software platforms to develop new phones, jettisoning at least four platforms.
“The company is trying to redeploy internally as many people as possible, but some will have to be laid off,” said an official at Motorola India, who did not wish to be identified because of the sensitivity of the issue. He added that the company will have to let go of a maximum of 15 people.
Unlike market leader and rival Nokia Oyj, which uses just two operating systems for most of its handset designs, Motorola has relied on more than half a dozen operating systems.
Motorola India, with its headquarters in Gurgaon, employs about 4,000 people and has offices in New Delhi, Mumbai and Bangalore.
“There are several software engineers, vice-presidents and directors in the market looking for jobs. About 400-500 people have become redundant in Motorola, but many of them are being redeployed internally,” said a human resources manager in an IT services company, who claimed to have interviewed many of these candidates. He requested anonymity for fear of jeopardizing his relations with Motorola.
The Schaumburg, Illinois-based Motorola had announced plans to slash 3,000 jobs on 31 October while declaring a third quarter net loss of $397 million (Rs1,929 crore today). The company had made a profit of $60 million in the year-ago period.
The layoff is expected to reap annual savings of $800 million. The company’s co-chief executive, Greg Brown, has said two-thirds of the layoffs would be in the sagging handset division. In the quarter ended October, Motorola slipped to the No. 4 position in the handset market behind Nokia, Samsung Electronics Co. Ltd and Sony Ericsson Mobile Communications AB. The US cellphone maker has also delayed the planned spin-off of its mobile handset business amid the current economic crisis.
Meanwhile, the process of rehiring, which Motorola India had initiated a few months back, is still continuing. It aims to rehire 220 middle and senior managers, who had left the firm over the past one year.