This article was published on April 15, 2013

Vodafone to cut 500 jobs in Germany to handle growing competition and lower fees


Vodafone to cut 500 jobs in Germany to handle growing competition and lower fees

Mobile technology provider Vodafone has announced on Monday that it intends to cut 500 jobs from its Germany operations. As reported by Reuters, the move comes as a result of the organization’s struggle to compete against other companies and their need to handle lower fees in the country.

According to a company spokesperson, the reduction in workforce is a two-year program and will see some jobs shift from Germany to Romania and India. Cuts in salary and support in areas like network technology and customer service are expected.

This isn’t the first time Vodafone has had to lay off employees. In January, it reduced its workforce in Spain due to a drop in sales, mostly as a result of the recession. It was estimated by the UGT union that the company would let go as many as 1,000 jobs or 25 percent in Spain. In this case, workers also saw their salaries cut and had the number of working days reduced by 15 days.

Reuters states that the company is being affected by the lower prices set for smartphones by Deutsche Telekom-owned T-Mobile as well as regulations that require fees to be lower for calls coming from other networks. As Vodafone is dealing with the unfortunate loss of jobs, some might wonder if this makes Verizon Wireless’s position to acquire the company any more appealing to stockholders.

Last March, Vodafone’s CEO Vittorio Colao said that he wasn’t sure whether there was going to be a change in the relationship between his company and Verizon, but that he was “willing to keep an ‘open mind on everything’.”

Vodafone shares have fallen in afternoon trading as of 2:06pm EST by 0.95 percent and are now at $29.12.

Photo credit: CARL COURT/AFP/Getty Images

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