Sony to cut 10,000 jobs in quest for profitability
Top execs asked to hand back bonuses
Sony is planning a major restructuring, with around 10,000 jobs – about 6 per cent of the company's global workforce – expected to get the chop after a press conference this Thursday.
Japanese newspaper Nikkei has reported (from behind a paywall) that the new chief executive Kazuo Hirai, who took the helm of the loss-making electronics giant in on April 1, plans to cut jobs in an effort to bring the company back to profitability.
Nikkei also reports that senior executives, including the outgoing CEO Howard Stringer, will be asked to hand back this year's bonus payments – which isn't too unfair considering the company lost $2bn last quarter.
Hirai's first target is expected to be Sony's small- and medium-sized LCD screen factories and the company's chemical company holdings, which should account for around half of the expected job losses. Hirai is also expected to take personal charge of Sony's loss-making TV business in an effort to bring the company's flagship division back into the black.
Sony has been hit hard by falling consumer spending on electronics since the 2008 financial crisis, as well as by the strong yen harming Japanese exports and by the problems caused by last year's earthquake. But the bigger threat comes from companies such as Samsung beating it in the core LCD market, and low-cost production elsewhere in Asia allowing rivals to undercut Sony on price.
Hirai faces a mammoth task in turning around Sony after four years of loss-making, and cutting jobs was a policy favored by his predecessor, Sir Howard Stringer, who cut 8,000 jobs and shuttered 10 per cent of Sony factories in 2009 after the company tipped into the red, and cut another 10,000 shortly after starting as Sony's CEO in 2005. ®