Panasonic to shed 15,000 jobs

Half the layoffs are in Japan, with the rest of the cuts being made globally. The company also plans to close 27 factories worldwide
Written by Tom Espiner, Contributor
Japanese electronics manufacturer Panasonic is to lay off about 15,000 staff because of the global recession, the company has announced.

Half the layoffs are in Japan, with the rest of the cuts being made globally, a Panasonic spokeswoman told ZDNet UK on Wednesday. The staff reductions are to be made by March 2010.

In addition, Panasonic announced that 27 factories will close worldwide — 13 in Japan and 14 around the world.

The spokeswoman was unable to confirm whether any of Panasonic's UK staff would be affected by the cuts. The company's UK headquarters are in Bracknell, Berkshire, while its European research and development facility is in Cardiff, where electronics products are also manufactured. Panasonic's UK fabs include a factory in Newport that employs 500. Panasonic has about 4,000 UK staff.

The layoffs were announced following Panasonic's third-quarter results, which showed consolidated group sales fall by 20 percent year-on-year. The company made ¥464.7 billion ($5.2 billion) less this quarter, compared with the same period last year. Overall group sales this quarter were ¥1,879.9 billion.

Panasonic said its business had suffered from a drop in consumer spending, combined with a surge in the yen.

"The current financial crisis [that] originated in the United States has spread across the world and the company's outlook [in] the business environment has been extremely uncertain," said Panasonic in a statement.

"The company's business conditions have worsened particularly since last October, due mainly to the rapid appreciation of the yen, sluggish consumer spending worldwide and ever-intensified price competition."

Operating profit in the third quarter was down 84 percent year on year, from ¥165.4 billion last year to ¥26.4 billion this year.

Panasonic joins other Japanese manufacturers that have been severely affected by the downturn. Hitachi, Sony and Toshiba have all warned of losses this year.

Credit: originally published on ZDNet.co.uk.

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