Sony, Sharp and Panasonic in crisis

Three Japanese giants are in trouble at the moment: Sony, Sharp and Panasonic. Though the three closed the first half in the fiscal year comfortably, the companies could get out of the depression with a change in leadership.

Sharp and Panasonic are forced to pit with combined losses exceeding 12,000 million Euros respectively.

For Sony, the new president, Kazuo Hirai, has made an aggressive plan to help the company in reaching similar heights that it has used to be. It looks like that the Japanese International wants to deliver the results immediately.

In a single year has managed to break the dynamic market that had put the former advisor thin, the American Howard Stringer, knowing not see the future of technology and leaving Sony out of the world of tablets and phones. 

Hirai has cut losses by 5.7% year on year to 386 million Euros. Since Sony closed last year with more than 4,400 million Euros of losses, Hirai planned 10,000 layoffs (6% of the workforce) and spending pay-cuts and minimized the
benefits to some extent.

In the first six months, Sony has seen falling sales of its video game division (15.2%), digital imaging (5.7%), televisions and other audiovisual equipment (25.6%), but has sought to enter brand in the field of Smartphones after
ending the partnership with Ericsson.

They have sold the wide range of Xperia phones in the market with a big promise and they are getting overwhelming response from the users. They have arguably sold 8.8 million units of the item and expect to place 34 million more
units by the end of this year.

Much worse is the situation of Panasonic and Sharp. They have recorded losses of reportedly 3,700 million Euros between April and September, almost ten times more than in the same period of 2011.

If we forecast their earning at the end of this year, it looks like they will lose more than 4,300 million Euros, which will be the worst result in their entire history. The century-old company, which introduced Television to Japan
in 1953, recognizes that they cannot go on like this:

"Our business group has had massive losses in the second quarter," reads the official statement from the company. "This raises serious questions about our ability to continue as a company." Sharp could not compete in the market
for flat screens and have few alternatives to find a solution.

Panasonic is another victim of the loss in the television market and a lack of vision to enter emerging sectors. Earlier this year they also tried their fate in launching the Smartphone. However, they are struggling to compete
with Samsung and Apple.

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Posted by Farasat Ali on Nov 3 2012. Filed under Sci-Tech. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry