Japanese consumer electronics giant Matsushita plans to cut its group workforce by about 3,000 or three percent in the current business year, despite improving profits, a press report said Sunday.
Matsushita Electric Industrial Co Ltd will also halt domestic production of such unprofitable products as electronics parts and batteries in the year to March 2005, the leading business daily Nihon Keizai Shimbun reported.
The Matsushita Electric group has slashed more than 20,000 jobs since it introduced an early retirement programme in the year to March 2002, bringing its workforce down to about 90,000, the report said.
It is unusual for a company with improving earnings to continue a substantial restructuring measure which, however, is necessary for Matsushita to match up rivals on the world market including Samsung Electronics and other South Korean makers, the report said.
No officials were available at Matsushita's head office to confirm the report.
The group said earlier it had spent about 350 billion yen ($3.2 billion) in the past three business years to reduce manpower and shut down production bases. It plans to spend 80 billion yen in the current year for the same purposes.
As a result, the group can save 200 billion yen in costs, compared with three years earlier, the report said.
The group's operating profit improved to 195.5 billion yen in the year to March 2004, compared with a record loss of 211.8 billion yen in the year to March 2002.
The new cost-cutting measure is expected to raise the group's operating profit margin to five percent as soon as possible, up from 2.6 percent in the year to March 2004.
The group plans to reduce 800 to 900 jobs under the early retirement system at its Panasonic system solutions division, which handles information systems development for corporate clients and government agencies, the report said.
A Matsushita unit, Matsushita Battery Industrial Co, will end domestic production of nickel-hydrogen batteries, which account for some 10 percent of its total sales, the report said.
The firm will move production to its subsidiary in Wuxi, China, in order to enhance cost-competitiveness, the report added.