TOKYO (Reuters) - Panasonic Corp, which posted a record net loss in the business year just ended, is mulling fresh job losses on top of 17,000 recent lay-offs as the Japanese electronics conglomerate looks to engineer a profit rebound, a source said.
Following restructuring at its plants and other facilities, next in line is the company’s headquarters, the source with knowledge of the deliberations said. Rather than redundancies, however, staff may be shifted to other units, subsidiaries or affiliates, the source added.
The maker of Viera TVs and Lumix cameras, which incurred a 772 billion yen ($9.7 billion) group net loss for the year ended March 31, may more than halve its 7,000 head office workers, the Nikkei business daily reported Tuesday, without saying where it obtained the information.
A Panasonic spokeswoman said no job cuts had been decided, adding that the company was, nonetheless, always looking for ways to restructure its business.
The consumer electronics maker’s most recent round of staff cuts taps into an emerging trend of redundancies at yen-hobbled Japanese manufacturers, particularly technology giants such as Sony Corp that are struggling to compete against foreign rivals, such as Korea’s Samsung Electronics.
Sony’s new chief Kazuo Hirai last month outlined plans to cut 10,000 jobs, or 6 percent of the global workforce at the firm, as losses mount in its TV division.
Yet, borne of a stakeholder business culture where firing workers is frowned upon, Japanese firms still eschew mass lay-offs. That hesitancy leaves them worker heavy and, therefore, less productive.
Panasonic, with annual sales of about $99 billion, employs some 350,000 people worldwide. Sony has half that number on its payroll. Panasonic’s payroll total is around three times that of Samsung Electronics and 60,000 more than General Electric, where annual sales are $30 billion higher.
Incoming president Kazuhiro Tsuga, due to take his post next month, has said one of his main missions would be to speed up decision-making. He has pledged to get Panasonic’s ailing TV business back on a firm footing within two years.
Sources told Reuters earlier this month that Sony and Panasonic were in talks to jointly develop the technology to mass produce next-generation OLED televisions, widely seen replacing current LCD TVs.
Panasonic, which aims to achieve a 50 billion yen group net profit in the year ending March 2013, would start discussing the latest job cuts with workers in July and likely start offering early retirement soon after, the Nikkei said.
The company was also considering spinning off R&D and production technology functions, the paper said. Procurement division personnel could be transferred to closely affiliated segments.
Panasonic’s shares gained as much as 3.3 percent in early trading in Tokyo and ended the morning session up 1.2 percent at 522 yen compared with a 0.3 percent fall in the broader Topix index. ($1 = 79.4850 Japanese yen)
Reporting by Tim Kelly, Reiji Murai and Chang-Ran Kim in TOKYO, Maneesha Tiwari in Bangalore; Editing by Sriraj Kalluvila and Richard Pullin