Japan's Sharp, struggling with deep losses and searching for a financial savior, has cut short an early retirement program after being flooded with volunteers.
The company said Tuesday that it ended the program after a week, having received 2,960 applicants, about 10% of its domestic workforce. The original plan was for the program to run for two weeks and target about 2,000.
The Osaka-based manufacturer, one of the world's largest makers of LCD panels for TVs and mobile displays, instituted the program as part of its restructuring efforts, which have also included broad salary cuts and mortgaging of key properties. The company forecasts a $5.6 billion loss this fiscal year.
The job cuts are taking place as Sharp negotiates with major foreign IT companies such as Intel and Hon Hai Precision Industry, the parent company of contract manufacturer Foxconn Electronics. News reports have said it is nearing a deal for a US$500 million investment from Intel, while talks with Hon Hai have stalled after a previous agreement was scuttled earlier this year.
Sharp is slashing costs as it attempts to deal with a major cash crunch. The company has secured emergency loans from its banks, but financing costs have risen since its stock downgraded to junk status by ratings agencies.
While the company is ailing financially, it still possesses cutting edge manufacturing and display technology, as well as some of the largest LCD assembly lines in the world. It is attempting to shift production away from televisions to the booming market for smartphone and tablet displays.
The employees will officially leave the company Dec. 15. Sharp has also moved other employees between its Japan-based factories as it realigns production.
The early retirement plan, announced in August, applies to domestic workers and was to run from Nov. 1 to Nov. 14. The company ended the program Nov. 9.
Sharp said it had 30,800 employees in Japan as of the end of July, with another 32,600 outside Japan.