Nortel Networks said Thursday it will cut approximately 2,900 jobs in 2007 and 2008, with the majority taking place this year.The company also plans to shift approximately 1,000 positions from higher-cost to lower-cost locations, with 40 percent of this move taking place this year. In a statement, Nortel president and CEO Mike Zafirovski said, “we are transforming Nortel, and are focused on building a highly competitive organization that drives innovation and profitable growth.” In early 2006, the company announced its “Business Transformation Plan,” which included a significant reduction in general and administrative expenses, while making R&D investment a top priority. The company will also reduce its global real-estate portfolio by over 500,000 square feet of space in 2007. Upon completion, these actions are expected to deliver approximately $400 million in annual savings, with approximately half of the savings expected to be realized in 2007. “These are tough but necessary measures, and we recognize the impact they will have on affected employees," added Zafirovski. "However, as we roll-out the various initiatives over the next two years, every effort will be made to leverage normal attrition and re-deploy affected employees to other areas of the company.” The cost of these actions could be as high as $390 million, approximately $300 million of which relates to the workforce reductions and about $90 million to the real estate actions.