An unfortunate decline in Japanese mobile phone demand has squeezed Toshiba out of its home country. Toshiba has announced that economic pressures have forced the company to pull the plug on the production of mobile phones in Japan. That means, come this October, Toshiba’s Japanese cellphone production operations will cease.
The decision to stop manufacturing cellphones in Japan follows a stark drop in Toshiba’s cellphone sales. Toshiba saw just 140 billion yen ($1.5 billion) in revenue for the year ending March 2009, as shipments of Toshiba mobile phones dropped to 3 million units from 6 million units from the previous fiscal year. The company’s financial performance mirrored its drop in cellphone sales – Toshiba has posted a record net loss (the first in seven years) of 343.6 billion yen for this fiscal year, compared to a net profit of 127.4 billion yen for the previous year.
On the bright side, Toshiba says that its mobile phone sales only account for 3% of its total operations. Toshiba will continue mobile phone production in China and will out-source manufacturing operations. And, the company says that employees involved in production will be reassigned to other jobs.
It’s never good news to hear that a mobile phone company is going through such economic bad times that they have to close factories, but we’re still looking forward to some exciting products from Toshiba. The Toshiba TG01 (pictured here) will soon usher in a new age of super-slim and power-packed Toshiba smartphones like the TG02 and TG03. Hang in there, Tosh, you’ll be fine in the long run.
[Via: Reuters]