Sony Ericsson to cut 2,000 jobs

Sony Ericsson announced today that it is to cut a further 2,000 jobs in a bid to make €400 million of savings.

The mobile phone maker revealed a pre-tax loss of €358 million (£315m) in the first three months of 2009.

The job cuts come on top of 2,000 previously announced redundancies by the firm as part of another savings drive. The business employs around 250 staff in the UK, although it was not clear where the cuts would be made.

Sony Ericsson's site in Manchester, which used to employ 500 people, is currently in the process of closing.

The company plans to cut a third of its global workforce by summer next year, from 12,000 employees to 8,000.

Sony Ericsson, the world's fourth biggest mobile phone maker, said it had shipped 14.5 million phones during the first quarter, a decrease of 35 per cent compared with the same period last year, and blamed falling sales on weak consumer confidence and de-stocking.

The results were in line with analysts' expectations of a €371 million loss, but did not include €19 million in restructuring charges.

Sony Ericsson will take an additional €200 million charge in order to shed the 2,000 jobs and implement the cost saving programme.

The company expects the global handset market to contract by at least 10 per cent in 2009, from 1,190 million units in 2008.

Dick Komiyama, president of Sony Ericsson, said: "As expected, the first quarter of this year has been extremely challenging for Sony Ericsson due to continued weak global demand. We are aligning our business to the new market reality with the aim of bringing the company back to profitability as quickly as possible."