1,000 Nortel jobs on block in Ottawa
Long-haul optical unit faces another major cut
Bert Hill
The Ottawa Citizen
Thursday, May 30, 2002
The Ottawa operations of Nortel Networks could lose another 1,000 jobs in a round of job cuts announced yesterday.
The new layoffs surprised Nortel employees and managers yesterday, coming only a month after chief executive Frank Dunn said no more cuts were necessary and top executives urged employees to concentrate on developing new long-haul optical products.
Yesterday, several levels of Nortel management tried to assure employees that most of the cuts will be concentrated in manufacturing, sales and field support services. Cuts to research and development are likely but will be limited.
The Ottawa operations are back on the chopping block because they are both a major product development and significant production centre for the long-haul optical products.
Nortel said yesterday it plans to cut 3,500 jobs by September through layoffs or sale of optical component operations. It declined to reveal regional numbers yesterday, but 500 to 1,000 more job cuts appear likely. Nortel had already cut the Ottawa workforce from 17,000 to 8,500 in the past 18 months.
Yesterday's news came as a shock -- even after seven rounds of cuts over the previous 18 months -- for the estimated 2,000 people in the region who work on long-haul products. In staff meetings only weeks earlier, they were assured by top executives that the cutting was finally over and Nortel was focused on preparing new products for the business turnaround expected in the next two years.
The start of sales of the HDX, a major new optical switch, and the drive to develop next-generation gear for new customer competitions lifted spirits.
But yesterday Mr. Dunn said: "Our focus is to bring all our business units into a profitable position at the current market levels."
Long-haul optical built Nortel's fortunes during the industry boom of 1999-2000, generating $10 billion in annual sales.
But in the March quarter, the operation generated only $276 million in sales and a staggering operating loss of $102 milion.
Nortel employees were told there are about 10,000 people in the long-haul optical division -- a figure that suggests 35 per cent will lose their jobs.
The biggest centres in Ottawa are at the Skyline campus at Merivale and Baseline Road, where hundreds of employees develop new products.
Nortel also builds some optical components at the main Carling Avenue campus and at the Palladium optical-components plant near the Corel Centre. It assembles complete systems in Montreal and Ireland.
The other major centre is in Britain, at Paignton on the English Channel and in development centres in Maidenhead north of London.
It also has some development operations at a major production centre near Belfast, Northern Ireland.
Long-haul optical unit faces another major cut
Bert Hill
The Ottawa Citizen
Thursday, May 30, 2002
The Ottawa operations of Nortel Networks could lose another 1,000 jobs in a round of job cuts announced yesterday.
The new layoffs surprised Nortel employees and managers yesterday, coming only a month after chief executive Frank Dunn said no more cuts were necessary and top executives urged employees to concentrate on developing new long-haul optical products.
Yesterday, several levels of Nortel management tried to assure employees that most of the cuts will be concentrated in manufacturing, sales and field support services. Cuts to research and development are likely but will be limited.
The Ottawa operations are back on the chopping block because they are both a major product development and significant production centre for the long-haul optical products.
Nortel said yesterday it plans to cut 3,500 jobs by September through layoffs or sale of optical component operations. It declined to reveal regional numbers yesterday, but 500 to 1,000 more job cuts appear likely. Nortel had already cut the Ottawa workforce from 17,000 to 8,500 in the past 18 months.
Yesterday's news came as a shock -- even after seven rounds of cuts over the previous 18 months -- for the estimated 2,000 people in the region who work on long-haul products. In staff meetings only weeks earlier, they were assured by top executives that the cutting was finally over and Nortel was focused on preparing new products for the business turnaround expected in the next two years.
The start of sales of the HDX, a major new optical switch, and the drive to develop next-generation gear for new customer competitions lifted spirits.
But yesterday Mr. Dunn said: "Our focus is to bring all our business units into a profitable position at the current market levels."
Long-haul optical built Nortel's fortunes during the industry boom of 1999-2000, generating $10 billion in annual sales.
But in the March quarter, the operation generated only $276 million in sales and a staggering operating loss of $102 milion.
Nortel employees were told there are about 10,000 people in the long-haul optical division -- a figure that suggests 35 per cent will lose their jobs.
The biggest centres in Ottawa are at the Skyline campus at Merivale and Baseline Road, where hundreds of employees develop new products.
Nortel also builds some optical components at the main Carling Avenue campus and at the Palladium optical-components plant near the Corel Centre. It assembles complete systems in Montreal and Ireland.
The other major centre is in Britain, at Paignton on the English Channel and in development centres in Maidenhead north of London.
It also has some development operations at a major production centre near Belfast, Northern Ireland.
