Kai-Uwe Ricke, chief executive of Deutsche Telekom Europe's biggest phone company, last night became the second head of a major German company to lose his job in a week.
Mr Ricke's departure, effective from this morning, comes four days after Deutsche Telekom said third-quarter profit declined 20 per cent as wireless earnings fell and the loss of fixed-line customers accelerated. Deutsche, which is cutting 32,000 German jobs, trails European rivals in trimming positions as the internet reduces demand for traditional phone calls.
The former monopoly's loss of traditional phone customers accelerated in the third quarter to more than half a million lines, bringing the decline in the first nine months to 1.5 million connections. Customers are defecting to cheaper providers such as Vodafone Group's Arcor unit and sellers of Web-based technologies.
Last week Volkswagen, Europe's largest carmaker, announced the departure of chief executive Bernd Pischetsrieder, who was expected to be in the post until 2012. The company gave no reason for the decision.
Mr Ricke, 45, last week announced plans to reduce the Deutsche's annual cost base by €2 bn next year and reach annual savings of €5bn by 2010 through smaller marketing budgets and making company units share more resources. The CEO had come under increasing pressure since the company slashed its forecasts in August. The Bonn-based company said yesterday it "reached agreement" with Mr Ricke on his resignation, a year before his contract ends.
Germany's Spiegel Online reported that Deutche's supervisory board chairman Klaus Zumwinkel had agreed the move with major shareholders, including the German government, which holds 31.7 per cent, and private equity firm Blackstone Group, which bought 4.5 per cent in April.
It is understood that Mr Ricke will be replaced by Rene Obermann, 43, the head of the T-Mobile wireless unit.Reuse content