Sony to cut 20,000 jobs in restructuring plan

Electronics giant Sony has announced a restructuring plan that will see 20,000 job losses over three years.

The Japanese firm has taken the decision in an effort to cut costs, boost profitability and return to its core electronics consumer market.

Up to 7,000 of the jobs will be lost in Japan.

The group’s lacklustre performance in the key sector had resulted in a sharp drop in its operating profit margins to about 2.5%.

Concerns about Sony’s growth prospects had also led to a slump in its share price.

According to Nobuyuki Idei, Sony chief executive: "The cost-cutting initiative, which aims to reduce fixed costs by Y330bn (€2.6bn) over 3 years, will allow the consumer electronics and entertainment group to achieve its target of generating 10 per cent operating margins by March 2006."

Idei also said he did not think there was a need to reorganise the movies, music and games businesses in the US and that while Sony was considering various options, there were no specific developments yet.