Struggling Japanese electronics maker Sanyo said today it planned to cut about 15 per cent of its global work force, close plants and halve debt as part of a three-year restructuring plan.
Sanyo is embarking on a sweeping overhaul of its operations following a net loss of 171.54 billion yen (€1.29 billion) for the year ended March 31st, hit by earthquake damage to a chip factory and sluggish sales of digital cameras and mobile phones.
Sanyo said it will cut about 14,000 jobs, including 8,000 in Japan where salaries are typically much higher than overseas. The company plans to cut 3,800 employees in Japan in 2005/06, the first year of the plan.
It also vowed to close or sell the equivalent of 20 per cent of its factories in Japan in area terms, cut 70 billion yen in costs and cut 600 billion yen of its interest-bearing debt, which stood at a 1.2 trillion yen as of March 31st.
Sanyo also said it would cut current assets by 130 billion yen and 70 billion yen of fixed assets and debt.
Chief executive Tomoyo Nonaka said she would focus resources on batteries and other promising technologies that are friendly to the environment. She billed the restructuring as the company's third birth following its founding in 1947 and a merger in 1986.
"We have to be ready to feel some pain under this new strategy . . . We must act with great vigour to get the job done," she said.
Shares of Sanyo closed up 0.34 per cent at 297 yen, outperforming the benchmark Nikkei average which declined 0.30 per cent.