Flextronics cuts Swedish cell phone work force

OXFORD, United Kingdom—Having accepted the contract to manufacture Ericsson’s cell phones, Flextronics has run into a storm of protest in Sweden following the announcement that it plans to cut nearly 25 percent of its work force. The company said the downturn in the worldwide cell phone industry has forced it to close down several Swedish plants that were formally operated and staffed by Ericsson employees.
Ronny Nilsson, head of Flextronics’ Western European operations, said that, as a manufacturing partner it was its role and responsibility to adapt itself to its customers’ needs. “Our manufacturing volume is a direct reflection of our customers’ demand and we cannot manufacture if our customers do not have corresponding needs.” He added that the firm was closely looking to move more of its manufacturing capabilities to Southeast Asia given the low cost of wages.
Ericsson confirmed in February it would outsource its loss-making handset division to Flextronics, which took over 4,200 Ericsson employees and cell phone production at plants in Brazil, Britain, Malaysia, Sweden and the United States. The job cuts will see up to 1,600 manufacturing staff made redundant in Sweden.