Sony reevaluates its plan in China
As Japanese electronics giant Sony Corp’s major manufacturing centre and one of its key markets, China has about 48,000 employees, more than one quarter of Sony’s global headcount.
But the global recession has also forced Sony to close at least five factories and curb world-wide investment.
It is said that there will be 16,000 people losing jobs since Sonyis reviewing China operations amid a global layoff plan.
Because of the global economic crisis, Sony China said that it will actively support its headquarters in Japan.
Due to the economy slowdown, consumers are no longer willing to by electronics products if they don’t need them so urgently, which hurt Sony a lot, according to Hou Li, an analyst at Essence Securities.
Price wars have clouded China’s consumer electronics market for a long time, which have produced razor-thin margins for some products.
In spite of the possible layoff wave, Sony said it remains committed to the China market.
Last year, Sony China generated $5.1 billion in sales, recording 20% annual growth for the third consecutive year.
Although the demand is slowing and competition is intensifying, China is still Sony’s largest growth potential market and also the most important part in the operation value chain, Sony China said, they have implemented several measures to struggle with the economy crisis.
Hou said that if Sony decides to curb investment in China, such movement could also destroy the profit of its partners.
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