Times of London – Sony “on the brink” to make drastic cuts

By on

428678315_c023482bf1_b

Sources telling the Times of London have said that Sony “is on the brink" of a corporate overhaul that could see job cuts, several factories closing and changes to the manufacturing and management process; even though the company told Reuters that no plan existed.

“We do not plan to announce additional restructuring measures at this time," a spokesperson told Reuters. “We don’t have any such plan.”

The restructuring – with analysts being quoted from the Times being “far too late” – are likely to be announced next month; which will see major divisions being shut down in domestic operations. This is a response to the growing inventory being piled up as the financial crisis, and a stronger yen, bites into its profits.

Sony, whose empire extends to semiconductors, gaming, a record label, movie production and insurance, has already said last month that it plans to axe 16,000 jobs; and implement a $1.1 billion savings plan in its electronics division. It will also curb investments and pull out of businesses to make an additional 100 billion yen a year in savings.

The company has fallen behind Apple’s iPod in the portable music player market; while it is losing money on its Bravia flat TVs. It has also fallen third place out of the next-generation game consoles, from a resurgent Nintendo with its Wii, and rival Microsoft’s Xbox 360.

According to the Times of London, there have also been some suggestion that there is some frustration between Sony’s operations in Japan and in the US and Europe; saying that several analysts in Japan have begun to notice the internal clash.