Sony isn’t having the best year, and it is responding by lowering its global workforce by 6 percent.
Sony is preparing to cut its workforce by 10,000, or 6 per cent of its global headcount, as part of a restructuring that has seen the Japanese electronics and entertainment group sell two divisions and drastically scale back its television production plans.
The cuts are to be announced on Thursday at a strategy briefing by Kazuo Hirai, who took over as chief executive on April 1, people familiar with the matter said. It will be the third significant round of staff reductions at the Japanese group since 2005.
When Mr Hirai’s appointment as chief executive was announced in February, he promised to make “unavoidable, painful choices” to fix or dispose of lossmaking operations and turn the company round after what will be its fourth straight year in the red.
About half the job cuts result from deals that have already been announced: Sony’s sale last month of a chemicals subsidiary to the Development Bank of Japan, a state-backed lender, and its decision last year to spin off production of small liquid crystal displays into a joint venture with Hitachi and Toshiba.
Most of the 5,000 workers employed by the two businesses will keep their jobs but will no longer remain on Sony’s payroll.
The rest of the reductions are expected to come from Sony’s chronically unprofitable television division, which is undergoing an overhaul that will be crucial to restoring the company’s financial health. Sony estimates that it suffered an overall net loss of Y220bn ($2.7bn) in the financial year that ended on March 31.
In November, Sony halved its medium-term sales target for LCD TVs from 40m to 20m, abandoning an ambitious goal it had set only in 2009. The business has been in the red for the past eight years.
Fucking insanity. Is anyone tech savvy? Or I suppose, economically savvy? What would it take for Sony to throw in the towel on their television department entirely?