Pioneer to exit plasma displays, lay off 10,000 workers
Hit by expectations of further financial losses, Pioneer Corp. has announced 10,000 job cuts, plant closings in the US and UK, and plans to leave the plasma display market.
With demand falling for both its plasma displays and car electronics equipment, the Japanese electronics maker now predicts that its net loss for the current fiscal year ending in March will total ¥130 billion ($1.4 billion), in comparison to a previous estimate of ¥78 billion.
Pioneer's job cuts will include 6,000 full-time salaried employees and 4,000 contract workers both in Japan and other countries.
In a move resulting in some 350 job layoffs, the company will shut down two overseas plasma display assembly plants, located in Pomona, California, and Castleford, Britain. Pioneer plans to exit the plasma display business entirely by March of this year, according to wire reports.
Although Pioneer's KURO-branded plasma TVs have gained high marks among some consumers, liquid-crystal-display (LCD) sets -- which provide brighter pictures -- have picked up more popularity with LCD prices dropping.
The decline in plasma TV sales has been forecast by analysts, anyway, even before the financial crisis. Back in November of 2005, DisplaySearch predicted that the plasma TV market would start shrinking in 2009, after peaking in 2008, while LCD TV sales would continue to rise.
But Pioneer's projected losses in its car electronics business -- which includes car navigation as well as car audio equipment -- would have been much harder to anticipate. With car sales slowing globally, Pioneer now projects a loss in its car electronics business of ¥12.5 billion for the fiscal year, in contrast to a previously forecast profit of ¥10 billion.