All 420 employees left will be laid off

By Monica Chen

mchen@heraldsun.com; 419-6636

MORRISVILLE -- Mobile phone maker Sony Ericsson is planning to lay off all 420 employees at its Research Triangle Park site in Morrisville and move its North America headquarters to Atlanta, citing a global restructuring and increased ability to serve the its clients from that location.

The company broke the news to employees Wednesday during a morning meeting at the Embassy Suites Hotel in Cary. The company had held a similar mandatory meeting at another area hotel a year ago, when it announced that it was cutting its RTP workforce by half, letting go 450 workers.

Employees were told Wednesday that they could take the day off, but many stuck around the company's facility off Davis Drive, trudging in and out of the 201,400-square-foot building as a light rain drizzled down.

Spokeswoman Karen Morris said the company's RTP operations included research and development, support functions, customer service and sales, as well as marketing and communications. R&D will be moved to Redwood Shores, Calif., while the other departments and the North American headquarters designation will be moved to Atlanta, which currently has only 18 employees.

During recent restructuring efforts, Sony Ericsson had combined the North American and Latin American regions. Morris also cited the location of client AT&T in Atlanta as a factor in the decision.

"Since we formed a region that now supports Latin America, we had to decide where best to support that," she said.

Whether certain employees will be transferred or given severance packages has yet to be determined at this point, Morris said. "We'll be meeting with people individually," she said.

Sony Ericsson shares the 89.8-acre RTP campus with Ericsson, which is also in the midst of a restructuring that will lead to the closure of its 180-worker facility by the end of the year.

Since August, Ericsson has been laying off employees in RTP in monthly waves. A spokesman for Ericsson said much of its R&D operations in the park will be moved to San Jose, Calif.

Dave Kim, a lab coordinator at Ericsson, said he will be among those laid off in December. The layoff dates are set for Thanksgiving and Christmas, he said.

"I'm distraught and frustrated," Kim said. "It's been devastating."

Sony Ericsson Mobile Communications Inc. was formed as a 50-50 joint venture between Sony and Ericsson in October 2001 to make mobile phones, accessories and PC-cards for the global market. R&D sites were in Europe, Japan, China, India and the U.S. Global headquarters are in London.

The site closures are new elements of a plan announced in April to cut a worldwide staff of 10,000 by 20 percent. About 400 jobs have been cut since then and about 1,600 remain to meet that goal by the middle of next year.

The company announced last month that its losses worsened to $245 million amid falling sales in the third quarter, up from a $37.25 million loss in the same period a year ago. Sales during the quarter dropped by more than 40 percent.

Sony Ericsson said its share of the global handset market came to around 5 percent in the third quarter, compared to 38 percent for market leader Nokia Corp.

The Associated Press contributed to this story.