10K workers to get pink slips in Sony layoffs
Despite being one of the biggest names in electronics, Sony has been posting enormous losses for four years running. The company has announced that it is expecting a quarterly loss of nearly $3 billion and is laying off 10,000 workers.
The mighty are despairing
Sony has released some of the most popular consumer electronic devices in living memory. Devices such as the Walkman, Discman and Playstations 1, 2 and 3 shipped in the millions and Sony’s entertainment division has produced some of the most successful films and television programs to date.
Despite all the success, Sony as a whole has been floundering. In 2000, according to Bloomberg, the company was worth $200 billion, which has steadily diminished into a present net worth of around $20 billion.And stagnant economic conditions during the past few years have led to diminished demand for consumer electronics.
When it rains
According to the Daily Mail, the effects of natural disasters in Japan as well as the flooding in Thailand, where most of Sony’s manufacturing is done, have crippled the company’s ability to get products to market, leading to horrific losses at the end of last year and the fiscal year that has just ended.
[One can always get payday-loans in a pinch]
In the last quarter of calendar year 2011, Sony posted a loss of $2.1 billion, according to CBS, and Sony is projecting a loss of $2.7 billion for the fiscal year that ended in March. In response to the losses, Sony is going to consolidate some of its operations, including selling off its holdings in chemical manufacturing. Sony’s liquid-crystal display, or LCD, division was already spun off this year into Japan Display, Inc., according to MarketWatch, a joint venture between Sony, Hitachi and Toshiba.
In addition to spinning off its chemicals operations, which are being sold to the Development Bank of Japan, Sony is also going to reduce its workforce by 6 percent, or 10,000 people. According to MSNBC, several top executives are also being asked to return bonuses.
Not the first round
Sony has gone through workforce reductions before. In December of 2008, the company laid off 16,000 workers at the depths of the recession.
The upcoming reductions in staff are slated to take place over a period of two years. Half of the layoffs are going to take place in Sony’s chemicals and LCD operations, while those businesses are being restructured.