Nokia plans to cut around 4,000 jobs at manufacturing sites in Finland, Hungary and Mexico as it looks to boost efficiency in its smartphone operations. The company said the changes are aimed at increasing its global competitiveness and stem from a review of its smartphone manufacturing activities announced last September.

During the course of 2012, device assembly will shift from Salo (Finland), Komarom (Hungary) and Reynosa (Mexico) to Nokia’s factories in Asia, where many of the company’s component suppliers are based. The European and Mexican facilities will shift their focus to smartphone product customisation.

Nokia said there will be a reduction in the work taking place on the sites in Europe and Mexico, which is anticipated to impact around 4,000 employees across the three factories. The personnel reductions will be phased through the end of 2012 with financial support and assistance provided to help people find new work locally.

"We recognise the planned changes are difficult for our employees and we are committed to supporting our personnel and their local communities during the transition," said Nokia executive VP for markets Niklas Savander (pictured).

Savander added that moving device assembly to Asia should reduce time to market and allow Nokia to work more closely with suppliers to more quickly introduce innovations into the market.

Nokia announced a tie-up with Microsoft to move its smartphone portfolio to Windows Phone in February last year and launched its first devices based on the platform – the Lumia 710 and 800 – in October.

CEO Stephen Elop recently said the Windows Phone devices are intended to “establish a beachhead in the war of ecosystems,” something he said is being accomplished country by country with launches planned for China, Latin America and the US. The company claims to have sold “well over” one million Lumia devices to date.

Nokia’s 2011 fourth quarter results reported a EUR1.1 billion loss on revenue of EUR10 billion, compared to a EUR745 million profit on EUR12.7 billion revenue a year earlier. The less-than-spectacular results were attributed to macroeconomic issues while Elop said it was “currently not appropriate” to provide targets for 2012 due to it being a year of transition.

The company’s financial statement also indicated that Nokia could receive considerably more than the US$1 billion from Microsoft originally reported, as part of its deal to use the Windows Phone platform in its smartphones.