nokia logo NPUNokia just suffered a setback in its legal tussle against India’s Income Tax department in Supreme Court. This ruling made Nokia counsel dare IT department to attach its assets and sell. Now, it seems Nokia may be already planning to move production from the Chennai plant to other plants and preferably Vietnam plant. Nokia management has already informed the workers in the factory that it may have to reduce headcount.

The Finnish mobile maker Nokia has told its workers at the Sriperumbudur factory, near Chennai, that it might have to reduce number of people in the factory, which the Union has strongly objected. The Union has said that they will take any steps to protect their employment of around 8,000 people, 50% of which are women, who are working in the factory.

On Wednesday, the Union and the management had an hour-long meeting in Chennai, to discuss the fate of the factory and the employees, which was supposed to get transferred to Microsoft before March 31 as part of the Euro 5.44 billion deal.

The internal Nokia sources confirm that Nokia has already reduced number of shifts to two, to balance operations with other manufacturing plants. So, it seems hostility that Nokia may be facing from Income Tax department in India may have contributed to this reduction in shifts and the job losses and Nokia may be shifting base to friendly countries like Vietnam.

Sources in the company confirmed that the number of shifts was reduced to two, but it was not related to slowdown it was more to balance the operations between the plants, across the World. During this time the company has started Vietnam plant so it is a question of balancing the production.

Nokia’s factory currently employees around 8,000 people directly and another 25000 indirectly. So far, since its inspection, the factory produced 800 million handsets.

This is something which needs to be highlighted. GOI needs to take immediate action and resolve this as soon as possible, as directly or indirectly thousands of workers and their families may get affected.

Thanks Tom for the tip. Cheers!