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October 19, 2012

Details Released by Sony on Massive Employee Layoffs

By Ed Silverstein, TMCnet Contributor

Sony employees knew bad news was coming. Now details are being released.

The company will cut its headquarters staff by 20 percent and close a plant in Minokamo, Japan that makes mobile phones and camera lenses, according to a company statement. Some 840 employees work at the plant.

Sony’s sold of its chemical products businesses last month, which led to some 1,800 employees being reassigned outside of the company.

Image via Shutterstock

Overall, Sony plans to eliminate 10,000 positions by March 2013. Many of the positions are in Japan. Between 3,000 and 4,000 are of the layoffs will take place in Japan, according to earlier statements.

Also, some 2,000 employees will be laid off in Europe. For instance, earlier this year Sony announced Sony Mobile Communications is laying off about a thousand workers and in October will move its headquarters from Lund, Sweden, to Tokyo, according to TMCnet.

Other layoffs are elsewhere. The staff reductions are supposed to save Sony $378.6 million a year.

The company has been losing money with lower TV sales and lower sales in other consumer electronics device sectors. It also has faced challenges in the global economy and natural disasters which hit Japan.

Sony’s new CEO, Kazuo Hirai, is emphasizing games, digital imaging, mobile devices and medical devices, according to Reuters.

In March, Sony reported a record loss of $5.7 billion for the just-concluded fiscal year.

When reviewing the more-recent condition of Sony, TMCnet’s Steve Anderson in August said that Sony's first quarter “looked like the fiscal equivalent of a train wreck.”

“Sony's first quarter accounted for a $312 million loss. Worse yet, $45 million of that loss came from the gaming division alone,” Anderson added. 

Edited by Brooke Neuman
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