Sony announced on Monday that the company plans to cut 10,000 of their jobs, that is, 6 percent of their global workforce. According to Reuters, the decision was adopted by the new CEO Kazuo Hirai in order to get the electronics company back on its feet again.
Sony has been confronting itself with numerous financial problems in the last four years, so everybody was expecting the new management to reform the company. Nevertheless, the new CEO’s decision did not please employees as Kazuo Hirai declared that he will ax almost 10,000 jobs in the future.
The CEO explained reporters that Sony is not the only company taking drastic measures in Japan. In fact, increasingly more companies from NEC Corp to electronics firm Panasonic Corp are forced to reduce their costs because the yen is getting stronger and there is a powerful competition coming from Apple and Samsung Electronics.
Many companies have been affected by the current economic status of Japan, but TV producers suffered the biggest losses. According to recent reports, Sony, Panasonic and Sharp lost almost $17 billion in the fiscal year that just ended.
Sony spokespersons announced that the company will hold a press conference on Thursday to present Hirai’s new plans. The new CEO took the position at the beginning of this month after Howard Stringer resigned as a chief executive. Yuuki Sakurai, head of fund manager Fukoku Capital, told the press that this is the right moment to cut jobs because it is easier for a new CEO to dictate the new direction of the company he runs. He further added that it would be better for Sony to shift their attention towards other products except TVs because the competition is very big in this area and Sony may not be able to win the battle.
This is not the first time Sony plans to cut jobs. In 2008, the company let 16,000 employees go because the financial crisis affected their production. Despite this, the company did not manage to regain its stability; therefore, some analysts think Hirai’s new measure may not lead to the desired outcome.