- Title: JAPAN: Panasonic warns of $4.2 billion loss, to cut 15,000 jobs
- Date: 5th February 2009
- Summary: CLOSE OF FLAT SCREEN TELEVISION SCREEN
- Embargoed: 20th February 2009 12:00
- Location: Japan
- Country: Japan
- Topics: Industry
- Reuters ID: LVA8J3QW9N5LI9CJLATPJG4FX2XS
- Story Text: Japan's Panasonic warns it would post an annual loss of 4.2 billion U.S.
dollars and cut 15,000 jobs worldwide amid a tough economy.
Japan's Panasonic, the world's No.1 plasma TV maker warned on Wednesday (February 4) that it would post an annual loss of 4.2 billion U.S.
dollars and said it would cut 15,000 jobs and close plants as it battles a slump in demand and a stronger yen.
The maker of Viera flat TVs and Lumix digital cameras is struggling with slowing sales, the growing costs of plant closures and other restructuring moves, and a steep rise in the yen, which cuts into exporters' overseas revenues.
It joins other Japanese consumer electronics makers such as Sony Corp in projecting a full-year loss.
A stronger yen also makes Japanese electronics less competitive against rival goods from South Korean firms such as Samsung Electronics Co Ltd, which are benefiting from a softer won currency.
"Globally, our plan is to cut a total of about 15,000 jobs,"
Panasonic director Makoto Uenoyama told a news conference, adding that the company might close up to 20 percent of its 230 factories around the world.
Panasonic, which ranks ahead of Samsung and LG Electronics Inc in the plasma TV market, revised its forecast for the full year to March 31 to a loss of 380 billion yen (4.2 billion U.S. dollars) from previous guidance for a 30 billion yen profit.
Meanwhile, Japan's Mazda Motor and Mitsubishi Motors also warned they would lose money this year as they build fewer cars in view of tumbling demand, joining a growing list of automakers awash in red ink.
Mazda Motor said that production levels will stay low in the April-June quarter because sliding global sales are slowing down efforts to bring inventory down to appropriate levels.
"I expect production levels will stay extremely difficult in the next year," Chief Executive Takashi Yamanouchi told a news conference in Tokyo.
The revisions had been expected after bigger rivals Toyota Motor and Honda Motor slashed their forecasts in the past few weeks, also citing pressure from the yen's steep rise.
Carmakers everywhere are idling factories, slowing assembly lines and shedding workers to prevent a costly further buildup of inventory.
But with sales continuing to tumble -- the U.S. market hit a 27-year low in January -- low output levels are set to persist well past the business year ending on March 31.
Mazda, Japan's fifth-biggest automaker, owned 13 percent by Ford Motor, now expects an operating loss of 25 billion yen (279 million U.S. dollars) in the year ending on March 31, instead of a 90 billion yen profit.
Shares of Mazda ended up 4.4 percent before the results were announced.
Mitsubishi Motors closed up 2.6 percent after its earnings, which were announced during afternoon trade. The benchmark Nikkei average rose 2.7 percent.
Japan's Nikkei stock average rose 2.7 percent to snap a three-day losing streak, with Hitachi Construction and other machinery shares surging on hopes that China's economy may soon turn the corner.
Tech shares extended gains on hopes they may be early winners from an economic upturn, while Honda Motor and Toyota Motor were buoyed by a slightly weaker yen, especially against the euro.
Though Japanese stocks surged broadly, with only two subindexes in negative territory, market players were wary, noting that the situation with the U.S. economy remains uncertain before passage of an economic stimulus package.
The benchmark Nikkei rose 213.43 points to 8,038.94, snapping a three-day losing streak, after earlier rising 3.3 percent.
The broader Topix gained 2.5 percent to 792.78.
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