Pioneer sets out plan to return to profitability
- 28 April, 2009 18:45
Struggling electronics company Pioneer has outlined a number of ventures and investments as part of its plan to turn its business around and return to profitability.
Losses at the company grew by more than six times to about ¥129 billion (US$1.3 billion) in the financial year ended March 31, it said Tuesday, while sales dropped 28 percent to ¥558 billion.
The company plans to concentrate on car electronics as its main business while continuing its home electronics activities in the audio/visual, DJ equipment and cable TV set-top box sectors. It has already said it will leave the plasma TV business.
It will cut a further 9,800 jobs, including 5,800 full-time employees, as it closes nine of its 30 production companies around the world. Three of Pioneer's five bases in Japan will be closed.
Pioneer will develop car electronics with Mitsubishi Electric, including hardware and software for car navigation systems and other audio-visual systems for use in automobiles. The two companies have already worked together since 2002, and have codeveloped car navigation software.
Pioneer has also agreed to form a joint venture with Shanghai Automotive Industry Corp. to develop and sell intelligent transport systems and car electronics in the Chinese market, it said.
On the financial front Pioneer said it needs to raise about ¥40 billion to implement its medium-term business plan. It will pursue various cost-saving measures and has received additional loans from its banks, it said. Pioneer agreed to sell a stake in the company to Honda for ¥2.5 billion, and continues to look at other financial partnerships.
Pioneer has already announced plans to form a joint venture with Sharp in the optical disc business