Sony to Close Smartphone Plant in Beijing, Shift Production to Thailand

Sony will close its smartphone plant in Beijing in the next few days, a company spokesman said, as the Japanese electronics giant aims to cut costs in the loss-making business.

Sony will shift production to its plant in Thailand in a bid to halve costs and turn the smartphone business profitable in the year from April 2020, the spokesman said on Thursday. He said the decision was not related to Sino-US trade frictions.

Sony's smartphone business is one of its few weak spots and is bracing for a loss of JPY 95 billion ($863 million) for the financial year ending this month.

Some analysts say Sony should sell the business amid acute price competition with Asian rivals. The company has a global market share of less than one percent, shipping just 6.5 million units this financial year mainly for Japan and Europe.

But Sony has said it has no intention to sell as it expects smartphones to be central to technologies for fifth-generation wireless networks, where cars and various devices would be connected.

Among Japanese electronics companies, Fujitsu last year sold its mobile phone business to investment fund Polaris Capital Group.

That left just three Japanese smartphone makers - Sony, Sharp Corp and Kyocera Corp - in a global market dominated by Apple, Samsung Electronics and cheaper Chinese rivals.

Samsung late last year said it would cease operations at one of its mobile phone plants in China, as its sales in the world's biggest smartphone market slumped.

© Thomson Reuters 2019