Sony cutting suppliers by half to save $5.3 billion

by Majed Athab { May 21st 2009 at 8:15PM }

In a move undoubtedly aimed at preventing any further losses, Sony corp. plans to cut its manufacturing suppliers by more than half. MCVUK reports the company will be whittling down its 2,500-strong suppliers list to just 1,200 by or before 2011. The restructuring will cut costs by around ¥500 billion ($5.3 billion).

While this is a big change for the company as a whole, it's uncertain how Sony's Computer Entertainment division will be affected. In what ways could this whole business of slimming down impact SCEA, or the PS3 for that matter?

Tags: business, recession, scea, sony

Reader Comments (Page 1 of 1)

maxpontiac @ May 21st 2009 8:23PM

This recession has affected us all.

Here's to hoping things getter better.

xbox420king @ May 21st 2009 8:33PM

Even giants like Sony are not immune to this economic mess we are in. Though I hope not much of SCE division will be effected.

Josh @ May 21st 2009 9:27PM

There's no need for so many suppliers when you're switching to a full digital distribution model.

Kdiggy @ May 21st 2009 10:47PM

Interesting theory sir. Maybe they don't need as many for the rumored PSP go!

tobz1000 @ May 22nd 2009 6:29AM

Why was this voted down? It's a good point - such a plan could've helped sway this decision.

Nobledevil @ May 21st 2009 10:39PM

The fact that they can probably run the business pretty well with half the suppliers (which should be the whole point since they only want to stem the losses not the products or their quality) means they are probably pretty happy to be rid of them. I hope these suppliers that are lost had other contracts so it's not just a giant job-loss situation, but this is just one of those things that need to be done in order to survive the worldwide economic slowdowns/meltdowns.

McDoobie @ May 21st 2009 11:01PM

While the term "save money" is always fun to hear, it also means "jobs lost" to some.

t @ May 24th 2009 4:29AM

Lets not feel sorry Sony.
They have longed charged a shit load of money for mediocre tech. Their pcs are nothing but window machines with a freaking magigate/memory stick duo slot and they mass produce stuff like it is going out of style as a function of their business model. So they are always left with a lot of junk they can't sell but that is ok to them cause they roll out new junk to replace it even it is only a change in button color.

Now with the economy down globally, Sony's run-a-muck-tech-glut has them seeing the chickens coming home. That's business.