Hitachi Ltd. said it is changing course and turning to contract manufacturers to produce its TV sets in the U.S. and Europe, according to a story in the Wall Street Journal, which says the move will reduce costs.
Hitachi announced it will begin using other manufacturers to produce its TV sets in the U.S. and Europe, according to a story in the Wall Street Journal.
Written by Yuzo Yamaguchi and Daisuke Wakabayashi, the story says that Hitachi split off its consumer-electronics business into a new company on July 1 as part of a series of restructuring measures implemented on the heels of the company’s 787 billion yen ($8.5 billion) loss in the past fiscal year.
The company’s first goal is to stop the bleeded at its TV unit, which accounted for most of the $1 billion-plus loss at Hitachi’s digital products division, the story says.
As part of the restructuring, Hitachi is outsourcing more of its manufacturing and procuring key components from outside the company.
The sharp slide in prices for TV sets abroad have made it difficult for Hitachi to differentiate its products by producing its components in house.
A bright spot for the company is its domestic TV business. It manufactures most of the TV sets for the Japan market.