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Alcatel-Lucent to lay off 10,000 worldwide; CEO tells French paper plan is 'last chance'

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Alcatel-Lucent Chief Executive Michel Combes told French newspaper Le Monde this layoff is the company's
Alcatel-Lucent Chief Executive Michel Combes told French newspaper Le Monde this layoff is the company's "last chance." - (Alcatel-Lucent)

Alcatel-Lucent said today it will cut another 10,000 jobs globally as part of an ongoing restructuring to improve the struggling telecommunications equipment maker's competitive position. Exact impact on New Jersey operations, where the France-based company employs a small segment of its work force, is unclear.

Among the job cuts, Alcatel-Lucent plans to shed 4,100 jobs in Europe, Middle East and Africa, 3,800 in Asia, and 2,100 in the Americas. The plans are part of a broader restructuring aimed at reducing operating expenses by 15 percent by the end of 2015.

An Alcatel-Lucent spokesman said the company is not specifying the number of job cuts by locality. Alcatel-Lucent employs about 3,000 in New Jersey, mostly in the Murray Hill section of New Providence, which is about 4 percent of its global head count. Alcatel-Lucent also has a research plant in Holmdel plus remote employees around the state.

Chief Executive Michel Combes told the French newspaper "Le Monde" that the future of the company is in question.

"Everyone knows this plan is the last chance," he told the paper. "The company is in a very serious situation."

The expense reductions announced today are the latest in the company's $1.36 billion cost-reduction effort first outlined in June, dubbed the Shift Plan. Company strategy calls for selling assets, cutting expenses and investing more in next-generation technologies, including cloud services and Internet routing systems that can handle more data traffic.

Alcatel-Lucent said today it plans to increase spending on next-generation technologies to 85 percent of research and development expenses, up from 65 percent now. The company also plans to cut spending on what it terms legacy technologies by 60 percent.

Jobs reductions will occur in administrative, sales and support functions.

"To carry out this plan, we must make difficult decisions, and we will make them with open and transparent dialogue with our employees and representatives," Combes said in a release from the company. "The Shift Plan is about the company controlling its destiny."

Alcatel-Lucent, formed in 2006 when France's Alcatel merged with the United States' Lucent, has struggled since its inception. The company reported a $1.86 billion loss in 2012. Combes took over as chief executive earlier this year.

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