Two of the world's largest makers of telecoms networking equipment, Corning and Alcatel, will eliminate a total of 3500 jobs as a result of the continuing economic slowdown.
Corning, a fibre optic cable maker, will also close three plants and take second-quarter charges totalling about $5.1bn because of waning demand for telecoms products.
The recent loss of 1000 jobs at the company will add to the 5900 employees it has shed this year. The costs will be included in Corning's third-quarter results.
President and chief executive John Loose said: "With the dramatic reduction of infrastructure spending across the telecoms industry, and our expectation that this market downturn could last 12 to 18 months, we are taking decisive action to lower costs and improve the future profitability of our Photonic Technologies business."
Corning Photonic Technologies develops and manufacturers photonic products including advanced amplifiers, dispersion compensation modules, and Dense Wavelength Division Multiplexing and pump laser products. The business had revenues of $1bn in 2000.
Loose explained that the abruptness of the industry downturn is unprecedented, and that the company "has to deal decisively with these new market realities".
At the same time, French telecoms equipment maker Alcatel, which failed in its bid to buy Lucent Technologies last May, said it plans to cut 2500 jobs, or 16 per cent of its US workforce, and will also consolidate its manufacturing facility in Raleigh, North Carolina.
Alcatel spokesman Brian Murphy said there would be about 800 layoffs in Texas, 700 in Raleigh, 100 in Virginia and the remaining 900 across the country.
He added that the research and development for access products will remain in North Carolina, and that the company plans to shift all other manufacturing functions to other locations in the US and Mexico by the end of the year.
Alcatel announced late in June that it would cut about 900 jobs and close three US facilities in Massachusetts, California and Oregon, because of demanding business conditions in its largest single market. The plant closures and job cuts are expected to occur throughout the second and third quarters of 2001.
With its North American headquarters in Dallas, Alcatel employs about 15,900 workers in the US.
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