Lockdown Nokia, The Finnish Company Will Shut Down Its Manufacturing Unit In Chennai Next Month

This is a big blow to the Indian electronics manufacturing industry. Nokia has said they will stop production in the Chennai plant in India from Nov 1. This is not good news for the people working there and will be a major setback for the Finnish electronics major.

The Chennai plant is one of the biggest manufacturing units for Nokia and takes care of many Nokia smartphones. Microsoft has taken over the Nokia devices business from April this year. Microsoft kept this plant out of the USD 7.5 billion deal with Nokia because this facility was under the Indian tax men scanner.

The company issued this statement "Microsoft has informed Nokia that it will be terminating the manufacturing services defined in the agreement with effect from 1 November 2014. In absence of further orders from Microsoft, Nokia will suspend handset production at the Sriperumbudur facility from 1st November."

Nokia will pay the employees for the on duty days till the plant comes to a complete halt. The plant is said to have over 6,000 employees. The reports do suggest that 5,000 of them have opted for voluntary retirement scheme from Nokia.

In March Nokia was served a notice of Rs 2,400 crores by the Tamil Nadu government because Nokia sold phones within India and not exported them overseas.

Seems like the troubles for Nokia continue to grow in India, they are no longer the preferred choice when it comes to mobile phones and people in India prefer Android phones over Windows. The road ahead for Microsoft would be tough as well. It will be interesting to see how they respond and keep the prices steady for Lumia devices.