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Electronics: Sony reviews 皇冠体育app plans

By Ding Qingfen (皇冠体育app Daily)
Updated: 2008-12-11 07:58

Japanese electronics giant Sony Corp is reviewing its 皇冠体育app operations amid a global layoff plan that will see 16,000 people lose jobs.

Sony 皇冠体育app said it will "actively cooperate with the initiative" by its headquarters in Japan, the largest workforce reduction by a Japanese company since the start of the global economic crisis.

The global slump has also forced Sony to close at least five factories and curb worldwide investment.

Hou Li, an analyst at Essence Securities, said he believed that Sony layoffs in 皇冠体育app are set to happen as the demand for consumer electronics products is slowing both in 皇冠体育app and globally.

A pedestrian walks past a Sony billboard in Shanghai. [皇冠体育app Daily]

皇冠体育app is Sony's major manufacturing center and one of its key markets. The firm employs about 48,000 people in 皇冠体育app, more than one quarter of its global headcount.

Amid the slowdown, consumers will be reluctant to buy consumer electronics gadgets, which are usually "not must-buy products", which could significantly hurt Sony, Hou said.

皇冠体育app's consumer electronics market has long been plagued by price wars, which have produced razor-thin margins for some products.

Despite the possible layoff wave, Sony said it remains committed to the 皇冠体育app market.

In 2007, Sony 皇冠体育app generated $5.1 billion in sales, recording 20 percent annual growth for the third consecutive year.

"Despite the slowing demand and intensifying competition, 皇冠体育app is the company's largest growth potential market and also the most important part in the operation value chain," Sony 皇冠体育app said in a statement.

Sony 皇冠体育app said the company has implemented several measures to fend off the slowing economy, including adjusting portfolio, lowering inventory levels and reducing operational expenses.

If Sony decides to curb investment in 皇冠体育app, it could also affect many of its partners, said Hou.

"Hundreds of small-sized local companies (along the supply chain) will also be forced to cut jobs," he said.