Sony to Reveal Cut Plans This Week
- Scribbled on January 21st, 2009 by Jonah Falcon
- Filed in Industry News, Legal Brief, Sony PSP, Sony PlayStation 2, Sony PlayStation 3
Sony will be revealing its “restructuring” plans this week, according to a wire report, which will probably involve cutting 5 to 6 plants, 16,000 jobs and curbing investments to mitigate a $1.1B debt.
However, it may not stop there, as analysts state that Sony needs to make even more drastic cuts, though Sony denies it will need to.
“Sony’s not in a position to halt all domestic production but it has to do something that drastic,” said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management. “If it announces plans to move production overseas while keeping only planning and development functions in Japan, that would be a positive.”
The wire blames the falling of the yen’s global value and the dramatic slowdown in the electronics industry due to the recession. CEO Howard Stringer, has we mentioned earlier is trying to get Sony to shift from hardware to software – one must wonder if Stringer is attempting to get Sony to pull a Sega; imagine the seismic shift in the video game world if that happened.
Whatever the case, it appears Sony is in more serious trouble than we thought.
(Thanks, Yahoo News.)
January 22nd, 2009 at 3:00 pm
[...] This leaves Sony with some hard decisions. Restructuring can mean drastic changes that effect all their product lines. The PlayStation 3 isn’t currently a shining example of high profit margins. The console needs time to reduce its overall cost, chip sizes and bring profitability. Is it in danger? “Sony’s not in a position to halt all domestic production but it has to do something that drastic,” said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management. “If it announces plans to move production overseas while keeping only planning and development functions in Japan, that would be a positive.” (gamestooge) [...]