Suunto lays off 76 out of 300 staff
Suunto has worked hard to put its sports products in a strong technical and commercial position. The excellent Suunto RACE not only looked good and worked well but was also priced reasonably and featured a strategically important app store. Even better, the company’s smartphone app is impressive and integrates the Hammerhead KAROO 3, providing the company with solid cycling hardware coverage.
However, there have been years of corporate issues behind the scenes. Initially, there were shenanigans with the former owner, AMER Group, before the company eventually transitioned to Chinese ownership in 2022. The new owners, Dongguan Liesheng Electronic Technology Co., Ltd., have an interesting range of products, including bone-conducting headphones and low-end smartwatches. Dongguan Liesheng seems to be a great fit for Suunto, offering access to Southeast Asian markets and potentially cheaper manufacturing and development.
Does that mean the company is doing well? Or not?
What’s Happened
Just hours after the launch of Suunto OCEAN Finnish media, MTV News reported 76 layoffs out of a total staff of just under 300 (25%). That information comes from an interview with Niina Sappinen [CFO] and other sources.
Suunto will transfer part of the production and part of the product development to China. The amount by which the staff will be reduced is 76. Before the change negotiations, we had slightly less than 300 staff. A huge number of people and long working careers at Suunno.
Suunto siirtää osan tuotannosta ja osan tuotekehityksestä Kiinaan. Määrä, jolla henkilöstö vähentyy on 76. Ennen muutosneuvotteluita meillä oli henkilöstöä hieman alle 300. Valtava määrä ihmisiä ja pitkiä työuria Suunnolla. [Niina Sappinen, Suunto CFO]
A range of people have lost their jobs including those who have been at the company for many years plus those in product management and development. Factory staff do not seem to have been as badly affected.
Going Forward
My understanding for customers in the near term is that this will not affect future product and feature launches.
However, I’ve heard rumblings of dual-site manufacturing (Finland+China) and of increases in the capacity of the existing Chinese manufacturing operations.
Despite assurances from the company, the writing must surely have always been on the wall that production would move to China. However, the zero-defect manufacturing required for OCEAN could mean some production is destined to remain in Finland along with QA, design and marketing.
Take Out
The sport and smartwatch markets are still growing but they now appear, as expected, to be consolidating around the larger players like Samsung, Garmin and Apple. However, there is no reason that a focused company like Suunto or Coros still cannot prosper. At least for now.
It’s not yet clear to me if these redundancies are driven because of urgency from a declining market position and declining cash flow OR because of longstanding plans from the owners to move production eastwards. My feeling is toward the latter.
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So Suunto is becoming more and more Chinese in practical sense. It’s a shame since Europe needs its own IT companies. Now, we only have Polar that is European when we look at software development.
Polar does manufacturing in China as well
Polar is dead
there are a few small bike computer companies too based in europe (mio cycle, twonav, sigma), but yes your point still broadly stands even if they probably manufacturer in asia
Apple+nvidia+google have a market capitalisation greater than the entire london stock exchange i beleive. and london is the biggest stock market in europe. It will be VERY hard to keep large, leading edge tech in europe.
That said the world is changing and will be markedly different in 10 years time…as China knows
>Apple+nvidia+google have a market capitalisation greater than the entire london stock exchange
In the context of this conversation Nvidia isn’t relevant and their current market cap is a bubble.
the point i was failing to make was that tech is inexorably drawn to the USA and its manufacturing to cheaper countries
Firstbeat is based in Finland. They created some of the algorithms that powers features in Garmin watches. Garmin acquired them in 2020.
I think this might be the end for Suunto unfortunately. From recent layoffs in other tech companies it seems to impact the morale and culture negatively. So it might be a risk this will happen Suunto too and the employees that weren’t laid off will be less productive/invested now and eventually start finding other jobs. It will take time build tech teams in China, transfer the knowledge from Finland and get the China tech teams up to speed. At least 1-2 years isn’t unreasonable imo. During this time the delivery will be slower. In these times with the hard competition from Garmin and Apple they will fall behind too much during this time. But this is just my speculation. I hope it goes well for Suunto.
They were bought up 1-2 years ago, so your timeline would fit.
Sorry for these employees. But thats what you get when not listening to customers and competitors. Suunto watches are quite cool, but on the one hand too expensive compared to other brands, or there are buggy and many features are missing. In the Suunto Forums many people complain about the few watchfaces (esp. for the amoled Race), the missing ability to pair more than one sensor of a type and the missing way to switch watches off, without causing havoc on the data. Suunto representatives say that they have this on the list, but want to implement other “cool” features first for over a year now. And the missing Web-Interface that most other competitors have is a point too, Even Coros started with just an app, but implemented their Evolab etc. later.
fair points
watchfaces – yes, other brands are also guilty of not making use of AMOLED
sensor – yep, and sensor naming, and ant+,
turning off – this is ok now?
web interface – sportstracker.com, kinda. just send the data to intervals.icu or strava or wherever. not sure why this is a biggie
This was to be expected when they were bought by Liesheng (Chinese company) back in 2022, too bad.
My Suunto 3 just died. Sent it over official service-center. Let’s see what they say about it …. Meanwhile, looking to eventually “upgrade” the dead one but I wanted a “made in Finland” model. I recall 9 Peak Pro was mentioned to be “made in Finland”. Actually the webpage shows a lot of marketing material saying that, that is carbon neutral and so on … guess what … Is now made in China . Same goes to the Vertical. Only the “basic” steel model still says made in Finland. All others are Chinese (solar and titanium) The marketing material is deceptive . Made you believe they are all made in Finland. When you go to the specification sheet says “CN” instead of “FI” . I actually asked same in the chat (don’t know if it was a human or a bot ) but after giving me a marketing pitch about how “Finnish design” and bla bla bla , acknowledge both 9 Peak Pro and most of Verticals are now made in China. Hope all laid off employees are well placed . I opted now for a Wahoo Rival that do not hide is made in china and cost only 99 EUR
you should find the RIVAL a bargain and with significnatly more features than the Suunto 3.