Report: Sony to cut 10,000 jobs

Struggling Japanese electronics giant planning to lay off 6 percent of total workforce globally as new CEO moves to restructure company and bring it back to profitability, report says.
Written by Jamie Yap, Contributor

Sony is planning to cut 10,000 jobs worldwide, or about 6 percent of its global workforce, as part of a massive restructuring meant to bring the beleaguered Japanese electronics company back to profitability.

The Wall Street Journal
(WSJ) on Monday, citing people familiar with the matter, said the cuts could be made over the next two years, although the timing has not yet been confirmed. A separate report by Japanese newspaper The Nikkei said the cuts could take place as early as the end of this year.

About half of the expected layoffs is due to the restructuring of two of Sony's businesses, the report stated. The company recently reached a deal to sell its chemical products business to the Development Bank of Japan, and also spun off its small-and medium-sized LCD (liquid crystal display) panels unit to Japan Display--a newly-formed joint venture between the LCD display manufacturing units of Sony, Toshiba and Hitachi.

The remaining 5,000 job cuts are expected to come partly from Sony's struggling TV business, it added.

Sony's layoffs come as the once-dominant Japanese electronics titan has shown losses for four straight years, and in February announced an annual loss of 260 billion yen (US$3.2 billion) for fiscal year 2011 ended Mar. 31, according to a report by ZDNet Asia's sister site, CNET.

Unnamed sources also told WSJ that seven executives, including CEO Kazuo Hirai and Chairman Howard Stringer, are expected to give up their bonuses for the recently concluded fiscal year.

Sony is not the only Japanese electronics company facing severe losses amid declining sales against stronger foreign rivals in South Korea and China. Panasonic had earlier predicted a US$10 billion loss for 2012, while Bloomberg had earlier estimated combined losses for Panasonic, Sony, and Sharp to amount to US$17 billion that same year.

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