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Alcatel to cut 1,000 US jobs by year end
Dallas, Oct 29: The grinding slump in the telecommunications industry will claim 1,000 more US jobs at Alcatel SA, the French phone equipment maker has said.
Dallas, Oct 29: The grinding slump in the telecommunications industry will claim 1,000 more US jobs at Alcatel SA, the French phone equipment maker has said.
Alcatel said on Monday it has already begun the reductions, which represent about 13 per cent of the company's US work force.
The Paris-based company said the cuts were designed to match costs with business levels, which have plunged for nearly two years as phone and networking companies have reduced equipment orders. Alcatel had 1,13,000 workers at the end of 2000 but will have only 60,000 at the end of next year. A spokesman for Alcatel USA said Monday's layoffs were part of that plan.
About 200 of the 1,000 cuts were carried out on Monday, all but a handful at Alcatel's US headquarters in the Dallas suburb of Plano, spokesman Brian Murphy said. Before yesterday, the company had 7,500 US employees, including 3,200 in Plano. The news from customers keeps getting worse.
Last month, local phone-service giant SBC Communications Inc announced it would eliminate 11,000 jobs and slash capital spending. Analysts warned then that SBC's decision to reduce capital spending was a sign of continued trouble for the phone equipment makers. SBC is a major customer for Alcatel USA, as are BellSouth Corp and Verizon Communications Inc.
"It's no mystery; the carriers are not buying anybody's products," Murphy said. "Their announcements affect us." US-traded shares of Alcatel rose 14 cents to close at 4.05 dollars yesterday on the New York Stock Exchange. The shares have fallen about 80 per cent in the past 11 months.
Bureau Report
The Paris-based company said the cuts were designed to match costs with business levels, which have plunged for nearly two years as phone and networking companies have reduced equipment orders. Alcatel had 1,13,000 workers at the end of 2000 but will have only 60,000 at the end of next year. A spokesman for Alcatel USA said Monday's layoffs were part of that plan.
About 200 of the 1,000 cuts were carried out on Monday, all but a handful at Alcatel's US headquarters in the Dallas suburb of Plano, spokesman Brian Murphy said. Before yesterday, the company had 7,500 US employees, including 3,200 in Plano. The news from customers keeps getting worse.
Last month, local phone-service giant SBC Communications Inc announced it would eliminate 11,000 jobs and slash capital spending. Analysts warned then that SBC's decision to reduce capital spending was a sign of continued trouble for the phone equipment makers. SBC is a major customer for Alcatel USA, as are BellSouth Corp and Verizon Communications Inc.
"It's no mystery; the carriers are not buying anybody's products," Murphy said. "Their announcements affect us." US-traded shares of Alcatel rose 14 cents to close at 4.05 dollars yesterday on the New York Stock Exchange. The shares have fallen about 80 per cent in the past 11 months.
Bureau Report