Japan Airlines files for bankruptcy protection

Japan Airlines filed for one of the country's largest bankruptcies, entering a restructuring that will shrink Asia's top carrier and its presence around the world.

A fleet of 279 aircraft, carrying nearly 12 million passengers a year on more than 400 routes, there's no doubt Japan Airlines is a high profile victim of recession.

The bankruptcy of the national flag carrier is a major blow for Japanese pride. JAL collapsed with $16.5bn of debt because the Japanese government is no longer willing to keep bailing it out.

About 15,000 workers will likely lose their jobs under JAL's administered restructuring, while the firm's creditors will suffer losses of more than $3bn.


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Bankrupt JAL scrambles to reassure passengers

Japan Airlines sought to reassure the travelling public Wednesday that it will keep flying despite declaring bankruptcy as its share price dropped to a new record low of just two US cents.

The debt-laden carrier apologised in full-page newspaper advertisements for causing "tremendous worries to customers" and promised that "JAL will keep flying" and that passengers' air miles will remain valid.

"Please be reassured and use us as before," the company pleaded.

The once iconic airline, a symbol of Japan's rise to prosperity, filed for bankruptcy protection Tuesday with 26 billion dollars in debt in the country's biggest post-war corporate failure outside the financial sector.
It is set to undergo a painful overhaul under a new corporate chief, with more than 15,600 jobs to be cut, reducing the workforce by a third, and many loss-making routes expected to be slashed.

JAL, which carries more than 50 million passengers a year, is set to receive almost 10 billion dollars in public funds and emergency loans under a three-year turnaround plan.

The Tokyo Stock Exchange will delist JAL shares by February 20, a move expected to wipe out shareholders' investments.

JAL shares were trading at a record low of two yen (two US cents), down three yen or 60 percent from Tuesday's close. The price could theoretically fall to a rock-bottom one yen.

"There are still people who are trading JAL, including those who are enjoying a one-month game, with the downside risk limited to one yen," said Hideyuki Higashi, a strategist at SMBC Friend Securities.

The company has made no announcement regarding its tie-up talks with American and Delta Air Lines, which are in a bidding war for a slice of the carrier, eyeing its lucrative Asian landing slots.

JAL is understood to prefer switching its alliance from the American Airlines-led oneworld grouping to SkyTeam with Delta.

But it is expected to take some time for JAL and Delta to clear anti-trust hurdles and get approval from US authorities for joint operations.

The government has tapped Kazuo Inamori, a 77-year-old entrepreneur, business guru and ordained Buddhist monk, to run the stricken airline during its overhaul, replacing Haruka Nishimatsu, who resigned as president Tuesday.

Yasuhiro Matsumoto, a credit analyst at Shinsei Securities, voiced optimism JAL will successfully implement the restructuring plan but said the company still lacks a solid long-term vision.

He said the turn-around plan involves "getting rid of money-losing businesses to return to profit and is not based on unfounded optimism that travel demand will grow in the future."

However, he said, the government still "has no growth strategy. It doesn't have a strategy on how JAL should design its international network."

The bankruptcy, shocking to many Japanese, dominated newspaper front pages.
The Nikkei business daily said debt-ridden JAL's failure should serve as a warning to other companies and the government in a country where the public debt now stands at about 180 per cent of gross domestic product.

"If you shun the pain that is ahead of you, greater pain will come someday," the Nikkei warned. "The fall of JAL, which shone in the past, sends this message to the state and companies."

Source : BBC AFP
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Nissan to cut 20,000 jobs amid stormy forecasts

Nissan Motor on Monday joined its Japanese carmaking rivals in forecasting a big loss for the current financial year, and said it would eliminate 20,000 jobs, in one of the most aggressive cuts announced by any Japanese company since the start of the global downturn.

The development reflects the growing urgency felt by Japanese manufacturers across the board as it becomes clear that the slowdown, combined with the persistent strength of the yen, is hitting more severely than thought.

"In every planning scenario we built, our worst assumptions on the state of the global economy have been met or exceeded, with the continuing grip on credit and declining consumer confidence being the most damaging factors," the Nissan chief executive, Carlos Ghosn, said in a statement accompanying Nissan's earnings release for the three months ended Dec. 31.

This will be the first annual net loss since Ghosn took the helm at Nissan a decade ago.

The entire industry is in turmoil. Toyota Motor, Mazda Motor and Mitsubishi Motors all recently announced they would post losses.

In the United States, the government is bailing out two of the country's largest automakers, General Motors and Chrysler. France on Monday announced a €6 billion, or $7.8 billion, loan plan to support its car industry.

"In 1999, we were alone. In 2009, everybody is suffering," Ghosn said Monday, according to The Associated Press.

Nissan said it now expected a net loss of ¥265 billion, or $2.9 billion, for the business year ending March 31. It had previously projected a ¥160 billion profit for the year.

The profit warning coincided with data released Monday showing that corporate bankruptcies in Japan rose 16 percent in January to the highest level in six years. Also, Japanese machinery orders declined for a third consecutive month in December.

"There has been a phenomenal decline in output in Japan, and it looks like the first quarter of this year will be even worse than the last quarter of 2008," said Hiroshi Shiraishi, an economist in Tokyo for BNP Paribas.

"Demand for capital goods remains in free fall."

Company financial releases over the past two weeks have shown that the drop-off in demand was much worse than feared, leading nearly all of the best-known Japanese companies - Toyota, Sony, NEC, Hitachi and Panasonic among them - to warn of major losses for the business year ending March 31 and begin a wave of layoffs in an attempt to preserve cash.

Honda Motor and Nintendo, the maker of the popular Wii game console, are among the few major companies to still expect a full-year profit, but they, too, have had to severely scale back their earnings expectations.

Nissan revised its forecast after a grim set of earnings for the last three months of 2008, as the economic slowdown and credit crunch caused its global car sales to slump 18.6 percent, to 731,000 units.

Nissan lost ¥83.2 billion from October through December - a major reversal from the net profit of ¥132.3 billion a year earlier.

With cars piling up unsold around the world, manufacturers have rushed to cut production and costs. Nissan on Monday announced that it would reduce output to 787,000 units by March 31 - down 20 percent from its original production plan. It is also reducing capital spending, scrapping bonuses for directors and eliminating 20,000 jobs in its 235,000-person work force; 12,000 of the job cuts will be in Japan.

Nissan's layoffs are the third major job-cut announcement in Japan since Jan. 30. In that period the electronics makers NEC and Panasonic announced layoffs totaling 35,000.

The downturn in demand for discretionary goods like cars has hurt manufacturers around the world.

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Source : IHT
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Japan’s Exports Plummet Record 35%, Signaling More Job Cuts

Japan’s exports plunged by a record in December, signaling companies will be forced to shut factory lines and fire more workers, driving the economy deeper into recession.

Exports plummeted 35 percent from a year earlier, the sharpest decline since 1980, the earliest year for which there is comparable data, the Finance Ministry said today in Tokyo. The December drop eclipsed a record 26.7 percent decline set the previous month. Economists predicted a 30.3 percent contraction.

The Bank of Japan today forecast the economy will shrink until the year starting April 2010 and said it may start buying corporate bonds to improve funding for businesses. Toyota Motor Corp., Sony Corp. and Honda Motor Co. are shedding thousands of workers and closing factory lines as profits and sales dwindle.

“This recession will be deep and widespread,” said Kyohei Morita, chief Japan economist at Barclays Capital in Tokyo. “Given today’s numbers, households should prepare for more job and wage cuts.”

The yen traded at 89.35 per dollar as of 3:54 p.m. in Tokyo from 89.14 before the report. Japan’s currency has gained 19 percent in the past year, further eroding exporters’ profits. The Nikkei 225 Stock Average rose 1.9 percent to 8,051.74 at the close in Tokyo, reversing earlier losses on optimism the central bank’s measures will help companies get access to cash.

Imports fell 21.5 percent from a year earlier, not enough to prevent a trade deficit of 320.7 billion yen ($3.6 billion), the third in a row.

Emerging Markets

Shipments to the U.S., China and Europe all fell by the most ever as the global recession spread, today’s report showed. Exports to Asia, which make up about half of Japan’s total shipments, declined 36.4 percent.

Exports to China slid 35.5 percent. Asia’s second-largest economy expanded 6.8 percent last quarter, the slowest pace in seven years, the government said today. Exports to the U.S. dropped 36.9 percent and to Europe tumbled 41.8 percent.

Factory output dropped 8.5 percent in November, the most in more than a half century, and machinery orders, an indicator of future capital spending, fell by the most ever.

Sony today forecast its first annual loss in 14 years. The world’s second-largest consumer-electronics maker also said it’s considering stopping production at one of two television factories in Japan to cut costs.

Toyota, which is forecasting its first operating loss in seven decades, may cut all 4,500 temporary workers because of sluggish demand, the Yomiuri newspaper said this week, without citing where it obtained the information.

Fire Workers

Honda said last week it plans to fire all of its 3,100 temporary workers by the end of April. President Takeo Fukui said last month the automaker may be forced to shift more of its production overseas if the yen strengthens further.

Every 1 yen gain against the dollar cuts Honda’s operating profit by 18 billion yen, according to the company. A stronger currency eats into the value of repatriated earnings and makes exported products more expensive overseas.

The Bank of Japan forecast that the economy will shrink 1.8 percent in the year ending March 31 and 2 percent next year. Mounting evidence the economy is in crisis prompted the central bank to cut interest rates to 0.1 percent last month.

Governor Masaaki Shirakawa’s policy board today said it may start buying corporate bonds of up to one year in maturity to prevent a shortage of credit from worsening the recession. It also announced details of a plan to purchase as much as 3 trillion yen of commercial paper, short-term debt companies use to fund daily operations.

The government has been unable to pass a stimulus package that could help encourage domestic spending in the absence of export demand. Prime Minister Taro Aso, who has called the recession a “once in a 100 year” crisis, is struggling to get approval from the opposition-led upper house to spend 10 trillion yen ($111 billion) to aid companies and households, whose sentiment fell to a record low this month.

Source : Bloomberg
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Sony to Announce Closing of Factory, 2,000 Job Cuts

Sony Corp. will announce the closing of one of two domestic television factories and the cutting of more than 2,000 jobs in Japan by the end of fiscal 2009, Nikkei said, without citing any sources.

Sony Chairman Howard Stringer, who will detail the plan at a news conference, will also downgrade the company’s fiscal 2008 earnings outlook, Nikkei said. The job cuts amount to about 3 percent of Sony’s domestic full-time staff, Nikkei said.

Source : Bloomberg
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Toyota overtakes General Motors as World Biggest Carmaker

Toyota has become the world’s biggest carmaker for the first time, knocking General Motors off the top slot after a 77-year unbroken period in pole position.

The Japanese group had been expected to take the lead a year ago after pushing ahead in a much stronger global market than the current one, but GM confounded car industry experts by holding on by a slim margin.

Yesterday, however, the American company said that its global sales had fallen 11 per cent the previous year to 8.35 million vehicles, which allowed its rival to overtake it. This week Toyota said that it had sold 8.97 million cars last year, a fall of only 4 per cent.

Both carmakers played down the shift in positions, coming as it did in one of the bleakest car markets for many years, although GM had said previously that it had been important for it to keep the top slot for corporate pride.

Don Esmond, Toyota’s senior vice-president for US operations, said: “Share doesn’t always pay the bills.”

Fritz Henderson, GM’s chief operating officer, said that the company would focus on other measures to show that it was turning its operations around: “I actually noticed that they passed us in market capitalisation, profitability and cashflow long ago,” he said.

Mike DiGiovanni, GM’s sales analyst, said that all companies were focusing on profitability and survival. He said: “I don’t think being No 1 in global sales means much at all to the average consumer. I think it’s an internal benchmark of our industry.”

GM is working to an end-of-March deadline to present a viability plan to the US Government to show that it deserves the $13.4 billion (£9.7 billion) emergency loan that it has been given to avert bankruptcy.

GM shares have suffered over the past couple of years and now it has a market capitalisation of just under $2 billion. Toyota has a market value of about $117 billion, although, like all major carmakers, it is suffering from the woeful state of the market. It has warned that it will record its first operating loss for its current financial year.

GM had more success than Toyota in many emerging markets. Last year the US carmaker sold 64 per cent of its vehicles outside the United States, up from 59 per cent in 2007. Sales in its domestic market fell by 20 per cent in 2008 but there were gains of 10 per cent in Brazil, 30 per cent in Russia, 9 per cent in India and 6 per cent in China.

The previous year GM remained in the global top slot by a tiny margin. It sold 9.369 million vehicles, while Toyota sold 9.366 million.

Source : TimesOnline
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Toyota may cut 3,000 more jobs in Japan

Japanese carmaker Toyota Motor Corp. is considering shedding 3,000 more temporary workers at its domestic plants due to worsening sales, a report said Tuesday.

Toyota may axe its entire remaining temporary workforce in Japan by around mid-2009, the Yomiuri Shimbun said.

In November Japan's top automaker had said that it might halve its temporary payrolls to 3,000 by the end of March.

Toyota is considering additional job cuts as new vehicle sales around the world show no sign of recovery, the Yomiuri said without naming its sources.

Toyota said it had no firm plans for its temporary workforce.

"There has been no decision to reduce the number of temporary workers to zero," a company spokeswoman said.

"As we decide on the number of temporary workers based on production and sales plans, we cannot say for sure what their future numbers will be," she said.

Contract workers helped the auto giant expand production when demand was growing.

Their number peaked at 11,000 in the first half of 2005 and stood at 9,000 at the end of March 2008, according to the Yomiuri. But with Toyota facing its first ever annual operating loss, the carmaker is seeking to slash costs.

The spokeswoman said the company stopped taking on new temporary workers in June 2008. The number at its 12 domestic plants could drop to 3,000 by the end of March if no contracts are renewed, she said.

Contract or temporary employees make up an increasingly large share of the Japanese workforce following the deregulation of the labour market in recent years, and they have been hardest hit by the recent wave of job cuts.

Source : AFP
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

NEC to lay off 1,200 temp workers

The NEC Electronics Corp. group will lay off 1,200 of its 1,400 temporary workers by the end of March, Kyodo News reported Thursday, citing company officials.

The major Japanese semiconductor manufacturer is not to renew the employment contracts of the temporary workers at its eight production plants and subsidiaries in Yamagata, Shiga, Kumamoto and other prefectures.

The ongoing global recession, which has greatly dampened semiconductor demand, forced NEC to make the decision to substantially reduce production, and cut jobs in consequence, said the report.

Source : ChinaView
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Sanyo cuts 1,200 jobs

Japanese electronics maker Sanyo Electric Co. said Thursday it will cut 1,200 jobs globally and barely break even in the fiscal year through March as sales get battered by sinking global demand and a strengthening yen.

Sanyo, which is being acquired by larger domestic rival Panasonic Corp., said the job reductions in its semiconductor division — 800 in Japan and 400 overseas — will be completed by the end of March.

"The job cut was due to a severe slump in the global semiconductor market," said Sanyo spokeswoman Chieko Gyobu. Half of the cuts will be full-time workers with the rest coming from part-time or contract workers, she said.

The cuts will amount to 5 to 10 percent of Sanyo's total work force in the semiconductor division. She declined to say a regional breakdown for the job losses abroad.

Revenue from Sanyo's semiconductor business is expected to stand at 140 billion yen ($1.6 billion) in the current fiscal year to March 2009, down from 12 percent year-on-year.

Earlier, Sanyo said it expects to post zero profit for the fiscal year ending March 31. In May, it had expected a 35 billion yen profit.

Sanyo said sales have dropped in electronics devices and semiconductors. Restructuring costs and the appreciation of the yen are also behind the lower forecast, it said in a release.

Osaka-based Sanyo also lowered its sales forecast for the fiscal year through March to 1.9 trillion yen from 2.02 trillion yen.

Sanyo posted 28.7 billion yen profit on 2.018 trillion yen sales in the fiscal year ended March 2008.

Its shares fell 3.9 percent to 148 yen. The announcement about the earnings downgrade and job cuts came after the market close.

Source : AP
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Japan's Sanyo braces for zero profit

Japan's struggling Sanyo Electric Co. is set to downgrade its earnings forecasts for the year to March, expecting a strong yen to wipe out its net profit almost entirely, according to a report.

Sanyo, which is to become a subsidiary of Panasonic Corp. later this year, will lower its forecast for group net profit from 35 billion yen (384 million dollars) to almost zero for the full year to March, the Asahi Shimbun said.

Its forecast of operating profit would be revised down by 40 percent to 30 billion yen from 50 billion yen, with sales expected to fall below two trillion yen for the first time in nine years, it said.

The company's earnings from microchip and other electronics parts are rapidly worsening due to the yen's appreciation, the Asahi said.

The company will announce the revised forecasts this week, the newspaper said without citing its sources.

The yen was trading at around 91 to the dollar at the end of last week, compared with above 99 at the end of March last year.

No comment on the report was available from Sanyo on Sunday.

Source : AFP
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Japan's TDK to cut 8,000 jobs

Japanese electronics component maker TDK Corp. said Thursday it would cut 8,000 workers and post its biggest net loss ever this fiscal year, due to falling orders and a stronger yen.

The company — known to consumers for its DVDs, audio tapes and other recording media — will cut the jobs as it closes four factories outside of Japan, said spokesman Kazutoshi Kogure. He declined to comment on which factories it would close.

TDK is the latest of Japan's big-name manufacturers to cut jobs and scale back production as the global economic slump unfolds. Others, including Toyota and Sony, have also announced cuts in recent months.

Kogure said the job cuts will come mainly from regular employees, although contract workers and others in the TDK group of companies will also be included.

TDK had a total of 65,500 workers as of the end September, the last time it released an official figure.

The company also said it now forecasts a net loss for the current fiscal year that runs through March, its first net loss in seven years. TDK expects a loss of 28 billion yen ($304 million), versus its previous forecast for a 25 billion yen profit.

It also cut its sales forecast to 673 billion ($7.32 billion) yen from 795 billion yen.

Kogure said the job cuts and factory closures would boost TDK's operating profit by 62.9 billion yen from next fiscal year, but the company could still finish

Source : AP
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Sony to cut 8000 jobs by 2010

Sony has said it will cut around 8000 jobs by 2010 in a bid to bring down costs across the company.

As the economic squeeze begins to spread from Europe and America into Japan, Sony believes it will need to cut 5% of its workforce to make ends meet.

The company has also revealed it will close two of its overseas manufacturing sites, with an aim to reduce plant operations by 10% over the next 15 months, particularly in the areas of LCD and mobile phone technology.

And finally, in an attempt to save around $1.1 billion by March 2010, the company will also be cutting manufacturing investment by around 30% as well.

Japan's economy has shrunk by 1.4% over the past three months, which has caused businesses to panic as that is more than four times the amount estimated.

"Particularly within its electronics business, where Sony has been most affected by the acute downturn in the economic climate, the company has already undertaken certain short-term measures, including adjusting production, lowering inventory levels, and reducing operational expenses", read a statement from the company.

"Going forward, Sony intends to adjust product pricing to mitigate the impact of the appreciation of the yen, curtail or delay part of its investment plans, and downsize or withdraw from unprofitable or non-core businesses".

"Furthermore, Sony plans to realign domestic and overseas manufacturing sites, reallocate its workforce and reduce headcount".

Sony has confirmed that the PlayStation division of the business will be under review with the rest of it, and could well be affected by the job losses, which have not been capped at the 8000 mark and could well exceed that if Sony see fit.

"In order to stay competitive in the accelerating global network environment, we will always carefully review and make structural changes, if necessary, in order to further expand and strengthen the PlayStation business around the world", said Sony Computer Entertainment.



Source : GamesDog
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Mitsubishi Motors eyeing 900 more job cuts

Mitsubishi Motors is preparing to cut some 900 more jobs as Japanese automakers downsize to cope with a slump in demand for cars, media reports said on Wednesday.

Japan's fourth largest automaker will not renew contracts for selected temporary workers at a factory in Kurashiki in western Japan, public broadcaster NHK said.

The local Sanyo Shimbun said in its online edition that the factory had already terminated 250 jobs by the end of last month, and the fresh job cuts could push the total number of layoffs above 1,000.

"The layoff is inevitable for us to cope with the rapid fall in sales," a factory official told the Sanyo.

"We are studying personnel transfers and other measures and trying our best to minimise the size of the human resource adjustment."

A company spokesman said no decision had been made.

Japanese automakers have struggled in the global economic downturn, although they are in much better shape than their US rivals, which are receiving government bailout loans for survival.

Japanese carmakers have expanded rapidly in recent years to meet brisk demand for their vehicles, but the sudden deterioration in the global economy has taken a heavy toll on their exports.

Mitsubishi Motors already announced in November it would cut 1,100 jobs, laying off one third of its temporary workers in Japan.

Toyota Motor Corp, Honda Motor and Nissan Motor, along with smaller rivals, have all decided to trim their workforce and lower production.


Source : Times of India
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Tokyo Stocks Decline Ahead of Rate Decision

Most Asian markets dropped Friday after U.S. stocks declined and crude-oil prices suffered steep losses overnight, with Japanese shares losing ground after a tentative start as investors awaited the Bank of Japan's decision on interest rates.

Shares of Toyota dropped in Tokyo on report it may post an operating loss during the current financial year, while HSBC Holdings extended losses in Hong Kong on speculation the banking giant may raise capital.

The Nikkei 225 Average fell 0.7% to 8603.56 in the afternoon, while the broader Topix index dropped 0.2% to 836.69, after moving in a range around break-even in early trading.

The volatility came ahead of the outcome of a decision on interest rates by the Bank of Japan after a two-day meeting, with the central bank widely expected to expand liquidity-boosting steps or even cut interest rates for the second time this year.

Credit-Suisse analysts wrote in a report the market was pricing in a chance of a rate cut by the Bank of Japan to 0.15% from 0.3%. "Any rate cut from an already low level will be taken by the market as largely a symbolic move."

In Hong Kong, the Hang Seng Index dropped 1.9% to 15208.68 and the Hang Seng China Enterprises Index gave up 1.1% to 8459.75.

Steve Cheng, associate director at Shenyin Wanguo in Hong Kong, said in spite of the day's losses, the market seemed "very resilient, as we are getting a lot of support" from Chinese shares traded in Hong Kong.

"The reason might be that people are still expecting more measures from China, especially something like a cut in interest rates or bank reserve ratio. This happens before every weekend, but this time it seems more likely," said Cheng.

Australia's S&P/ASX 200 was recently down 0.3% at 3570.70 and South Korea's Kospi rose 0.3% to 1179.82, while New Zealand's NZX 50 index lost 0.9% to 2684.39.

China's Shanghai Composite rose 0.1% to 2018 and Taiwan's Taiex gave up 1.3% to 4635.85. Singapore's Straits Times Index shed 0.4% to 1792.14.

In Tokyo, shares of Toyota dropped 1.2% after the Nikkei business daily reported the automobile giant was likely to post its first-ever operating loss during the year ending March 31 on plunging worldwide sales.

Hong Kong stocks were weighed down as market heavyweight HSBC Holdings tumbled 4.5%, on top of Thursday's 3.4% decline, on market speculation it may raise capital.

Energy-related stocks dropped across the region, with Woodside Petroleum slumping 6.7% and BHP Billiton dropping 3.6% in Sydney, while Inpex tumbled 6.9% in Tokyo trading.

January crude-oil futures slipped as much as seven cents to $36.15 a barrel in electronic trading, after sliding 9.6%, or $3.84, to $36.22 a barrel Thursday on the New York Mercantile Exchange.

In Asian currency trading, the U.S. dollar changed hands for 89.16 yen, compared 89.20 yen Thursday.

Source : WallStreetJournal
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Japan workers protest massive wave of job cuts

Hundreds of unionized workers rallied in Tokyo on Tuesday to protest massive job cuts, accusing the country's biggest companies of sacrificing jobs to protect profits.

The global financial crisis has forced some of Japan's corporate giants to take drastic measures including job cuts, suspending production, postponing projects and closing factories. Sony Corp., Toyota Motor Corp. and Nissan Motor Co. are among the major employers to trim thousands of workers from their payrolls.

About 200 protesters waved banners and shouted slogans through loudspeakers outside the headquarters of the Nippon Keidanren — Japan's largest business lobby group — in Tokyo's main business district.

"Toyota, stop cutting seasonal workers! We workers are not disposable!" they chanted. "Sony, stop massive firing!"

Most of the job cuts have targeted temporary contract workers, but lately they have included full-time salaried workers.

Speakers at the protest said some newly unemployed contract workers also lost their company-owned housing, leaving them jobless and homeless.

"We do not accept job cuts in the name of the economic crisis," said Kazuko Furuta, a representative of New Japan Women's Association, a women's rights group that organized the rally with dozens of labor unions. "Shame on the Japanese companies that dump their workers like objects."

Economy, Trade and Industry Minister Toshihiro Nikai told reporters Tuesday that the government was doing its "utmost to support small businesses and ensure job security."

Fujio Mitarai, head of Keidanren and also chairman of Canon Inc., said the influential lobby "will cooperate with the government" to implement job security measures.

Japanese exporters have been hit hard by slowing consumer demand from abroad and the yen's appreciation, which erodes their overseas earnings.

Sony announced plans to slash 8,000 jobs around the world — about 5 percent of its work force — and lowered its full-year earnings projection 59 percent from the previous year.

Major automakers including Toyota and Nissan have terminated contracts with thousands of seasonal workers at their factories and parts makers.

Citing their own tally, union members say more than 18,800 people, mostly contract workers, have lost their jobs in recent months.

The government last week announced a 23 trillion yen ($256 billion) stimulus package to shore up the economy, including measures to encourage employment.

Source : AP
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Growing list of investors and banks hit by $50bn Fraud by US Trader Bernard Madoff

The list of investors and banks hit by an alleged $50bn (£33bn) fraud by US trader Bernard Madoff is growing.

Leading Spanish, British and Japanese banks say they could be facing losses of billions of dollars.

Other victims include film director Stephen Spielberg's Wunderkinder Foundation charity.

US authorities have ordered the liquidation of the trader's brokerage firm, Bernard L Madoff Investment Securities of New York.

Mr Madoff, who was arrested on Thursday, has been charged with fraud in what is being described as one of the biggest-ever such cases.

He ran a fund that paid annual interest of about 10% but prosecutors say it was, in effect, a pyramid scheme, with money from new investors paying off old ones.

Shares fall

Banks and financial institutions across the world had investments with Bernard Madoff, but not all have yet confirmed what their potential losses might be.

Among the potential losers is Spain's largest bank, Santander, which owns the UK High Street banks Abbey, Alliance & Leicester and Bradford & Bingley.

The bank had a direct exposure of 17m euros ($23m; £15m), but clients of its Optimal fund management unit have another 2.3bn euros invested in the firm run by Bernard Madoff.

Japanese financial giant Nomura said it could lose up to $303m.

Britain's HSBC said it had investments of about $1bn, which could be affected.

Royal Bank of Scotland said it could potentially lose about £400m ($601m) if all its investments had to be written off.

The French bank, Natixis, a subsidiary of Caisse d'Epargne and Banque Populaire, said it could potentially lose up to 450m euros (£402m; $605m).

One of the world's biggest investment groups, Man, said it had invested about $360m through its RMF institutional fund of funds business, representing 0.5% of its total funds.

Banking shares fell around the world, with Royal Bank of Scotland dropping 3.7%, HSBC losing 1.2% and US banks making up the top four losers on New York's Dow Jones Industrial Average.

Some of the biggest private losers seem to have been members of the Palm Beach country club, where many of Mr Madoff's wealthy clients were recruited.

High returns promised

US prosecutors say Mr Madoff, a former head of the Nasdaq stock market, masterminded a fraud of massive proportions through his hedge fund and investment advisory business.

Mr Madoff is alleged to have used money from new investors to pay off existing investors in the fund.

A federal judge has appointed a receiver to oversee Mr Madoff firm's assets and customer accounts, while the 70-year-old banker was released on $10m bail.

Mr Madoff founded Bernard L Madoff Investment Securities in 1960, but also ran a separate hedge fund business.

According to the US Attorney's criminal complaint filed in court, Mr Madoff told at least three employees on Wednesday that the hedge fund business - which served up to 25 clients and had $17.1bn under management - was a fraud and had been insolvent for years.

He said he was "finished", that he had "absolutely nothing" and "it's all just one big lie", and that it was "basically, a giant Ponzi scheme", the complaint said.

If found guilty, US prosecutors say he could face up to 20 years in prison and a fine of up to $5m.

Source : BBC
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Suzuki quits World Rally scene as sales dip

Japanese carmaker Suzuki Motor Corporation has pulled out of next year's FIA World Rally Championship citing a drop in sales due to the global financial crisis.

The Suzuki decision was released in a statement on Monday, 10 days after Honda, another major Japanese car manufacturer, pulled its team out of Formula One.

"In responding to the contraction of the automotive sales caused by recent global economic turmoil, Suzuki has been promptly taking possible countermeasures," the statement said.

"To secure its own business environment for tomorrow, the organization reviews every aspect of the operations and decided to focus on the core business functions such as the manufacturing system, environment technologies, and development of new-generation powertrains. As a result, Suzuki concluded to suspend the WRC activities from 2009."

Suzuki, who started their involvement with international rally competition with the 2002 Junior World Rally Championship, entered two SX4 WRCs in the 2008 World Rally Championship.

The team finished fifth of six teams in the constructors championship and the Suzuki Sport team drivers were 12th and 13th in the individual standings.

"The entry to JWRC and WRC brought a great deal of positive effects on the product development and marketing activities, nurturing the high sporty automotive brand image, especially in Europe," the company's statement said.

"Suzuki will continue to support the customers who are participating in the JWRC with Swift Super 1600 machines, and local motor sport such as Swift Cup in Europe and the rest of the world."

Honda made the shock decision to pull out of F1 on December 5, a day after announcing it was cutting jobs in Britain and Japan and reducing its annual production of consumer cars because of continued plunging vehicle demand.

Source : CNN
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Credit Suisse Said to Cut at Least 30 Jobs in Japan

Credit Suisse Group AG, Switzerland’s second-largest bank, is cutting its investment- banking workforce in Japan in half and closing some local operations, two people familiar with the matter said.

Credit Suisse Securities (Japan) Ltd. eliminated at least 30 jobs in the country last week and is shutting its securitization business and paring back leveraged finance operations, the people said, declining to be identified as no announcement has been made.

The company joins overseas financial firms including Morgan Stanley and Citigroup Inc. in reducing headcount in Japan, as the global financial crisis spreads into Asia. Zurich-based Credit Suisse said Dec. 4 it is eliminating 11 percent of its global workforce, or 5,300 jobs, and scrapping executives’ bonuses after reporting 5.2 billion francs ($4.4 billion) in losses this year.

“Brokerages are increasingly withdrawing from businesses that drain their balance sheets and focusing on fee businesses, like merger advisory,” said Wataru Kasatani, a senior research analyst at Meiji Dresdner Asset Management Co. in Tokyo, which manages about $2.5 billion in Japanese equities. “More job cuts will come in the financial industries.”

Credit Suisse has posted about $13.7 billion in losses and writedowns tied to the global credit crisis, the sixth-highest amount among European banks, according to data compiled by Bloomberg.

Japan Loss Doubles

The bank’s Japanese business lost 7.3 billion yen ($81 million) in the year that ended March 31, more than double the year-earlier shortfall, according to a regulatory statement.

“Credit Suisse remains committed to the investment-banking business in Japan,” said Isamu Kajino, a Tokyo-based spokesman for the Swiss bank, declining to confirm or deny any job cuts.

The company aims to expand its mergers and acquisitions advisory and equity capital market businesses in Japan, one of the people said.

“The need for investment-banking businesses is still there,” Kasatani said. “Japanese companies are trying to buy overseas assets, making the most of the strong yen and falling prices.”

Credit Suisse declined 2.6 percent to 28.72 francs in Zurich trading yesterday and is down 58 percent this year.

Morgan Stanley cut as many as 65 jobs in its securitization division in Japan earlier this year, two people with knowledge of the matter said at the time. The unit buys mortgages and packages them into tradable securities. Merrill Lynch & Co. closed its local real-estate financing unit in February, eliminating 11 jobs.

Citigroup, the U.S. bank that’s cutting 52,000 jobs worldwide, will eliminate about 1,000 positions at its retail brokerage unit in Japan, two company officials said Dec. 10, declining to be identified.

Credit Suisse is the ninth-ranked adviser on Japanese mergers and acquisitions so far this year with 11 deals worth a combined $10.2 billion, including Mitsubishi UFJ Financial Group Inc.’s acquisition of UnionBanCal Corp., according to data compiled by Bloomberg. The bank ranked 17th last year.

Source : Bloomberg
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Citigroup to cut 1,000 jobs at Japan unit

Citigroup Inc. will slash some 1,000 jobs at its Japanese brokerage unit as part of the ailing U.S. banking giant's efforts to survive the financial meltdown, a report said Wednesday.

Nikko Cordial Securities Inc. will cut its work force through early retirement, and some 1,000 employees, mostly those aged above 40, have accepted severance offers, Kyodo News agency said, citing no sources.

The Japanese brokerage employs about 7,000 workers, and the job cuts will amount to 14 percent of its total work force.

A spokesman for Nikko Cordial's parent company, Nikko Citi Holdings, a subsidiary of Citigroup., declined to confirm the report.

Citigroup plans to slash 53,000 jobs worldwide, the second-largest job cuts by a U.S. company on record, as the once-mighty banking giant is saddled with heavy losses and a shriveled stock price.

The U.S. government has agreed to guarantee risky Citigroup debt valued at $306 billion and also pump another $20 billion in cash into the ailing bank, on top of an earlier $25 billion injection that was part of the government's initial round of investments in troubled financial institutions.

Nikko's Japanese rival, Nomura Holdings Inc., announced last week that it will cut up to 1,000 jobs in London.

The move comes less than three months after Japan's top brokerage took over the global business of failed U.S. investment bank Lehman Brothers Holdings Inc.

Source : AP
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Sony to cut 8,000 jobs

Japan’s Sony Corp is planning to cut 8,000 jobs very soon. A report saying, due to global slow down the company is planning to retrench so it could fight back to the bad economy.

But experts say that the cut won’t be enough for the tech giant and in near future it may play another strategy to stay in the race.

According to the reports, the company is aiming to cut $1.1 billion in costs out of its struggling electronics operations.

The 8,000 job cut comes to about 5 percent of its global electronics workforce of 160,000.

An expert say, “The number sounds big, but this staff reduction won’t be enough. Sony doesn’t have any core businesses that generate stable profits.”

Source : FreshNews
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]

Toyota to Cut 3000 Jobs in Japan

Toyota Motor Corp., Japan's biggest carmaker, will cut its domestic temporary workforce by 50 percent as vehicle demand slumps globally.

Toyota will cut the number of temporary workers to 3,000 from 6,000 by the end of March, spokesman Paul Nolasco said today in a phone interview.

The automaker follows Mazda Motor Corp. and Isuzu Motors Ltd., which yesterday said they would slash a combined 2,700 temporary jobs in Japan in response to slowing sales. Earlier this month, Toyota forecast a 68 percent drop in full-year net income, the biggest decline in at least 18 years, as a global recession cripples auto demand.

``Falling export demand is having a big impact on production in Japan,'' said Hirofumi Yokoi, a Tokyo-based analyst at automotive consulting company CSM Worldwide. ``It's unlikely plants will get shut down, but if things get worse, lines, shifts will have to be stopped and plans for new factories will be delayed.''

Japanese companies, which focused on hiring easy-to-fire contract workers during the 15 years of lackluster economic growth that followed the bursting of the bubble economy in 1990, are now shedding them as the global recession cuts demand. Temporary and part-time workers make up 33 percent of Japan's workforce, up from 20 percent in 1991, according to the Labor Ministry.

Honda, Nissan

Honda Motor Co., Japan's second-largest carmaker, also said today it is cutting 270 temporary workers at its Saitama plant, where the carmaker is reducing output of Accord sedans by 40,000 units. Honda is also cutting production in the U.K. of Civic compacts and CR-V sport-utility vehicles by 21,000 units.

Nissan Motor Co. said last week it will reduce its domestic production by an additional 72,000 units. Japan's third-largest automaker had its credit rating cut one notch today by Fitch Ratings, which cited the company's dependence on the weak U.S. auto market and an appreciation of the yen.

Toyota gained 4.6 percent to 3,080 yen at the close of trading today in Tokyo. The shares have dropped 49 percent this year, set for the worst annual performance since at least 1975.

Credit Crunch

The credit crunch has crippled U.S. vehicle sales, forcing General Motors Corp., Ford Motor Co. and Chrysler LLC to seek a combined $25 billion in U.S. government loans as they burn through cash. U.S. unemployment claims for the week ended Nov. 15 surged to the highest since 1992 as Americans filed 542,000 initial jobless claims.

Japan's exports declined at the fastest pace in almost seven years in October, and Toyota's U.S. sales plunged 23 percent last month.

Toyota, heading for its first drop in U.S. sales in 13 years, will extend the Christmas-New Year closure at its U.S. and Canadian plants by two days. The carmaker will also cut Sienna minivan output in Indiana by half in January and slow one of two Georgetown, Kentucky, factory lines.

While no full-time employees will be laid off, the company will eliminate at least 50 percent of its 500 temporary workers at the Georgetown plant during the first three months of 2009.

Source : Bloomberg
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession]