The slump in high-tech sales that has pounded U.S. manufacturers this year is taking a toll overseas as well, with two of Japan's leading companies projecting worsening sales and mounting financial losses.
The slump in high-tech sales that has pounded U.S. manufacturers this year is taking a toll overseas as well, with two of Japans leading companies projecting worsening sales and mounting financial losses.
Hitachi Ltd. and Matsushita Electric Industrial Co., both suppliers of key computer and commercial electronic components, slashed their earnings forecasts for the year today, saying in separate announcements that a worldwide slowdown in sales has deepened since the Sept. 11 ter-rorist attacks in the United States.
While U.S. computer and chipmakers in recent weeks have said they are optimistic that sales may have bottomed out in the current slump, worsening outlooks in such key markets as Ja-pan and Asia could mean a hoped for worldwide high-tech recovery will be further delayed.
Underscoring its somber projections, Tokyo-based Hitachi forecasted that for its fiscal year ending in March its losses will be 60 percent greater than it previously projected. As a result, Hi-tachi now expects to lose $1.87 billion on sales of $64.8 billion for the fiscal year.
Hitachi is one of the worlds leading manufacturers of servers and semiconductors, such as DRAM.
For the first six months of its fiscal year, Hitachi reported that sales of its semiconductors fell sharply and that plunging prices of TFT LCDs also took a heavy toll, resulting in a year over year drop of 24 percent.
The outlook offered by Matsushita, based in Osaka, was even more dour, with the company, best known abroad for the Panasonic brand, projecting that for its fiscal year ending in March its losses would total $2.17 billion on $55.8 billion in sales. That marks a dramatic downturn from a few months ago when Matsushita predicted its would post a slight profit for the year.
Matsushita is a major supplier of DVD and CD players for computers, mobile communica-tions equipment, LCD screens and notebook computers.
Both companies also announced plans to trim their work forces, a potentially embarrassing move for two companies that have long promoted themselves as offering life-time employment.
Hitachi saying it plans to cut 15,000 jobs and Matsushita looking to eliminate 8,000 employ-ees. The two electronic giants are among the worlds biggest employers, with Hitachis work force totaling about 340,000 worldwide and Matsushita employing about 290,000.