Deutsche Telekom's T-Com to cut 22,300 more jobs
7 October 2002 -- In addition to 7200 job cuts in 2002 already announced, T-Com, the fixed network division of Deutsche Telekom, has announced that a further 14,000 of its 43,600 staff will go in 2003 plus about 8,300 more up to 2005.
7 October 2002 -- In addition to 7200 job cuts in 2002 already announced, T-Com, the fixed network division of Europe's largest telecom provider Deutsche Telekom, has announced that a further 14,000 of its 43,600 staff will go in 2003 plus about 8,300 more up to 2005.
The new measures are a further step in the implementation of Deutsche Telekom E3 programme announced in July to "increase efficiency, improve results and accelerate the reduction of debts".
Deutsche Telekom says that the programme will be implemented without compulsory redundancies by cutting vacant positions, adaptation of outsourcing practices and the transfer of personnel to the new internal Human Resources Service Agency placement and retraining unit.
Also, T-Com is investigating the extent to which already defined cost reduction measures for the future can be implemented in 2003.
* In first-half 2002, Deutsche Telekom's sales were EUR25.8bn (up 15% on first-half 2001), driven by an increase in subscribers at the T-Mobile division. However, it lost EUR3.8bn (up from EUR3.45bn for the whole of 2001), due to the rising costs of the expansion drive by former CEO Ron Sommer.
Charges for depreciation and amortisation on assets (including VoiceStream) rose by EUR2.2bn on a year ago. It also wrote down the value of a stake in France Telecom by EUR253m and posted a loss of EUR400m on the sale of the shares.
Debt was EUR64.2bn in Q2/2002. Interim CEO Helmut Sihler, appointed six weeks ago, has pledged to intensify cutting jobs and investment and selling assets. Deutsche Telekom is therefore trying to sell real estate and a cable network to reduce debt to EUR50bn by end-2003.