Vodafone Spain is planning to cut up to 515 jobs, mainly in its commercial operations, as it faces challenging conditions in the competitive market.
The company said it would meet with unions at the end of September and open a one-month negotiation period to lay off up to 12 percent of its Spanish workforce.
For some years now, intense price competition and the drift towards low-value fees in Spain has led to a sharp fall in revenues and a significant margin deterioration, Vodafone Spain said in a statement.
Vodafone Spain’s service revenue grew by 0.8 percent in June quarter of 2021 largely driven by roaming and visitor revenue. The market remains highly competitive, particularly in the value segment. Vodafone Spain grew mobile contract customer base by 27,000 during the quarter, supported by strong public sector demand.
Vodafone Spain in May announced price increases for Vodafone brand, effective across customer base from 15 July 2021.
Vodafone Spain’s second brand Lowi added 60,000 mobile customers and now has a total customer base of 1.3 million.
Labour unions denounced the move as an attempt to hide executives’ failure to redirect the company and called for innovation and greater efficiency instead of job cuts.
“This is Vodafone’s fourth round of layoffs in eight years… and represents lawmakers and regulators’ inability to provide sustainability to a key sector crucial to the digital economy of the future,” the UGT union, which holds 50 percent of workers’ negotiating votes, said in a statement.
Vodafone is the latest mobile and broadband operator to seek cuts to its workforce after France-based Orange announced it was laying off 485 employees in May, citing Spain’s increasingly low-cost, hyper-competitive telecoms sector.