TOKYO – Japanese electronics company Pioneer Corp. will cut 10,000 jobs globally to cope with sinking sales of car audio equipment and flat-screen TVs. It will also withdraw from its money-losing plasma display business.
The massive job cuts, announced Thursday, are the latest from Japanese corporate giants, which are slashing their payrolls worldwide, reducing production and forecasting annual losses amid a global economic slump. Sony Corp. is shedding 8,000 workers while Nissan Motor Co. and NEC Corp. are each cutting 20,000.
Hit by the collapse in demand for car audio equipment and plasma TVs, Pioneer said its net loss in the current fiscal year to March will swell to 130 billion yen ($1.4 billion) from its previous estimate of a 78 billion yen net loss. It would be the fifth straight annual net loss for Pioneer.
The Tokyo-based company said it will slash 6,000 full-time salaried workers at home and abroad, accounting for 16 percent of the company's global work force of 36,900. It will also cut 4,000 contract workers at its Japanese and foreign plants. It did not give a regional breakdown.
Pioneer is also shutting two overseas plasma display assembly plants — one in Pomona, California, and the other in Castleford, Britain — by April. Some 350 employees at the two factories — 130 in the U.S. and 220 in Britain — are part of the 10,000 people subject to job cuts, said company spokeswoman Ema Suzuki.
The factory closures are part of the plan to withdraw completely from the display business by March, 2010, as the company concluded that it would be impossible to turn around the display business.
Pioneer reported a net loss of 26.15 billion yen ($290.52 million) for the October-December quarter, nose-diving from a profit of 1.69 billion ($18.76 million) the previous year. Operating revenue declined 37.8 percent to 131.23 billion yen ($1.46 billion).
"Since the U.S. financial crisis and ensuing global downturn, our sales of car electronics products and flat-screen TVs plunged worldwide. We were severely hit by battered consumer sentiment," said Michiko Kadoi, another Pioneer spokeswoman.
A company statement said Pioneer would continue facing a tough business environment amid "intensifying competition involving our core products, as well as the impact of the worsening global economic downturn and the Japanese yen's rapid appreciation."