Sony Mobile, in an attempt to save the company from its dwindling fortunes, will be eliminating nearly 15 percent of its mobile phone workforce. The company will also be moving its global headquarters from Lund, Sweden to Tokyo, Japan.
The reduction of 1,000 jobs will happen mainly in Sweden, reported the company in a statement. "Today Sony Mobile filed a redundancy notification ("varsel") with the Swedish authorities to notify them that the company expects around 650 employees across a number of functions at Sony Mobile in Lund to be affected by job closures," said the statement.
Sony will begin the layoffs throughout its 2012 and 2013 fiscal years and will continue the downsizing till March 2014.
"Sony has identified the mobile business as one of its core businesses and the Xperia smartphone portfolio continues to gain momentum with customers and consumers worldwide. A more focused and efficient operational structure will help to reduce Sony Mobile's costs, enhance time to market efficiency and bring the business back to a place of strength," said President and CEO of Sony Mobile Kunimasa Suzuki.
The decision to lay off employees is seen as an outcome of Sony's recent struggle to generate profits and survive in the immensely competitive smartphone market, which players like Samsung and Apple currently dominate.
The announcement came six months after Sony's decision to take control of its mobile business, which was formerly a joint venture with LM Ericsson.
The Tokyo-based company is also restructuring the roles and responsibilities of all the major developments in order to increase operational efficiency, streamline the supply chain management, reduce costs, and drive profitable growth.
This has been a torrid year for Sony as the company posted a $6.4 billion net loss for the year, ended March 31, 2012.
According to Strategy Analytics, in the Q1 2012, Sony's global market share in smartphone space was 4 percent compared with 31 percent of rival Samsung and 24 percent of Apple.
