Sat, Aug 04, 2018 - Page 12 News List

Hon Hai to make home appliances for Sharp: report

STRATEGIC SHIFT:By transferring production of home appliances to its parent firm, Sharp can focus on the R&D of new IoT-related technologies

Staff writer, with CNA, Tokyo

Japan-based electronics giant Sharp Corp is planning to relocate its home appliance production to the global bases of its majority stakeholder, Hon Hai Precision Industry Co (鴻海精密), a Japanese daily reported yesterday.

In a front page story, Nikkei Shimbun said that Sharp would downsize its home appliance manufacturing in Japan and move the operations to Hon Hai’s plants in China and Southeast Asian nations such as Thailand.

Sharp president and chief executive officer Tai Jeng-wu (戴正吳), a former Hon Hai executive, was cited in the report as saying that Sharp is to focus on the production of higher value-added electronics components, including flat panels.

The Japanese firm will also concentrate more on the research and development (R&D) of new technologies related to the Internet of Things (IoT), he said.

The report said that Sharp would suspend its LCD TV production in Yaita in Tochigi Prefecture later this year, and Hon Hai’s plants outside Japan would take over.

The Tochigi plant has been one of Sharp’s major TV production sites since it opened in 1968 manufacturing cathode ray tubes, Nikkei said.

Sharp is poised to move all its other TV production operations, except its Kameyama plant in Mie Prefecture, to Hon Hai factories, it said.

After the relocation of the manufacturing plants, Sharp will move its R&D resources at Yaita to Chiba and its headquarters in Osaka, leaving the Yaita site to provide logistics services only, the newspaper said.

The 662 employees at the Yaita plant are to be assigned to other jobs within the company, the report said, citing data valid as of March.

In addition, Sharp is to move its refrigerator production operations in Yao, Osaka, to Hon Hai’s global sites, the newspaper said, adding that the factory currently produces 200,000 to 300,000 refrigerators a year and has a work force of 1,602.

After the relocation, the Yao factory is to house an R&D division and a production line for lighting devices, the report added.

Hon Hai in August 2016 acquired a 66 percent stake in Sharp, which turned to profit in the year ending March this year after years of heavy losses.

In the second quarter of this year, it posted an operating profit of ¥24.8 billion (US$223 million), compared with ¥17.11 billion a year earlier.

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