Japanese giant chipmaker Fujitsu will slash its worldwide workforce by 15,000, or nearly 10 percent, and close some overseas plants in response to the high-tech slump, a newspaper reported yesterday.
Details of the sweeping restructuring, which had been flagged by Japan's biggest flash memory chipmaker, would be announced today, the Nihon Keizai Shimbun business daily said without citing sources. |
No one was available to comment at Fujitsu.
The chip giant shocked the market last month by forecasting a US$1.83 billion consolidated net loss for the year to next March, largely reflecting a massive restructuring charge to cope with the chip and electronics slowdown. That was steeply down from its previous profit estimate of US$41 million.
Fujitsu will slash the jobs by next March, the paper said, while Kyodo news agency said the plant closures will take place by March 2004.
The company, which reported a group operating loss of US$351 million in the April-June quarter, will consolidate its domestic and overseas plants for computers and telecommunications products, the newspaper said.
Only 3000 job cuts in Japan
Manufacturing plants in North America and the rest of Asia are expected to bear the brunt of the overhaul, with only 3000 workers at home expected to lose their jobs, it said.
An early retirement system introduced last month will be used at home, Kyodo reported, citing company officials.
They also said Fujitsu will consider consolidating its product lines for semiconductors -- the main culprit for the firm's weak earnings performance -- including those in northern Japan.
Fujitsu plans to scale down its hardware operations and concentrate on the software and services divisions with high growth potential to improve profitability, they said.
It will also focus on production of profitable high value-added items in its mainline operations such as microchips, computers and communications equipment, they said, according to Kyodo.
In the telecommunications field, Fujitsu will end production of switches in the United States and concentrate on fibre-optic products.
Fujitsu will shift several thousand production workers to software and services divisions and create a task force to promote global corporate alliances and buy-outs in these fields, it said.
It also said it would sharply cut flash memory chip production at its US facility in Oregon, its only remaining overseas semiconductor plant.
