September 2, 2014 / 2:20 PM / 5 years ago

Renesas says may cut more jobs, but restructuring past halfway

TOKYO (Reuters) - Japanese chipmaker Renesas Electronics may cut more jobs as it finishes a massive restructuring that is focusing its business on the automotive and industrial sectors and has pulled it back into the black after years of losses.

A Renesas Electronics Corp's chip is pictured at the company's office in Tokyo March 21, 2013. REUTERS/Yuya Shino

Remaining steps will focus on selling factories and exiting businesses announced in a 2012 restructuring framework, updated a year ago, with about 40 percent of the plan still to be implemented, Renesas Chairman and CEO Hisao Sakuta told a media round table on Tuesday.

“To be honest, maybe we still have slightly too many people,” Sakuta said. “If there’s a mismatch between what the company is trying to do and what an individual wants to do, people will probably be quitting.”

Renesas, hit hard when a March 2011 earthquake shut a key chip plant for months and sent customers looking for other suppliers, has already cut more than 10,000 jobs and racked up 350 billion yen ($3.3 billion) in cumulative net losses over the last four financial years.

Its fifth round of a voluntary early retirement program was taken up by 361 employees as of Sept. 30. The group workforce had shrunk to 27,200 as of end-March from 42,800 two years earlier.

Sakuta said the company hoped to boost its proportion of sales to automotive and industrial customers to more than half, from 40 percent, while focusing its technological resources on advances such as in-car navigation and automatic safety systems.

Last week, Renesas unveiled a chip using new technologies that it aims to eventually apply to autonomous driving, which merges together feeds from cameras fitted to the car to create a 3D image and can detect pedestrians within several meters of a vehicle.

Test shipments of the chip begin this month, while full production and supply will likely begin in 2016, Renesas said. It is also developing technologies that will enable valet parking of a car by itself, without a driver inside.

Renesas, which was rescued by a 150 billion yen investment a year ago from a government-backed fund, has sold an integrated chip factory in northern Japan to Sony Corp while Renesas SP Drivers Inc, a subsidiary and Apple Inc supplier, is due to be sold to Synaptics Inc for $475 million.

The company also plans to shut or consolidate several plants in Japan.

Renesas said last month it expected a 28 billion yen net profit for the six months to end-September, marking its first half-year profit since 2008.

The company’s shares have risen 25 percent in the past three weeks off a three-month low struck on Aug. 12, outperforming the benchmark Nikkei average’s 3.4 percent rise. The shares, which rose 1.9 percent on Tuesday to 874 yen, have nearly quadrupled in value since April 2013 after languishing near record lows set in the wake of the 2011 earthquake.

(1 US dollar = 104.9000 Japanese yen)

Editing by Edmund Klamann and Mark Potter

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