Toshiba Closes Three Factories, Employees Get Shuffled

There are highs and lows as time passes for the IT industry, and Toshiba is definitely at one of the lows, perhaps not even at the bottom yet, having been constrained to close off three of its factories.

Toshiba is reorganizing itself in the wake of troubled marketing performance brought about by what are, for the most part, symptoms and / or consequences of the economic recession.

Cutting production at some of its semiconductor facilities between late November (2011) and early January (2012) was easy enough to predict.

After all, not long ago, Kingston decided to lend the company, as well as Elpida, a hand by purchasing some large volumes of RAM chips (to lighten the oversupply problem).

Toshiba decided it was going to take some more drastic measures to reorganize its semiconductor facilities in Japan.

Its analog, imaging and discrete IC (integrated circuit) businesses are in need of a boost, so it will gradually shut down three plants while improving three others.

Fortunately, as opposed to other reorganization processes, no employees will actually lose their jobs over this. Instead, they will be transferred.

Reductions to working and operating hours will be implemented as well.

“Temporary reductions in working and operating hours will give Toshiba the flexibility it needs to respond to the fall off in demand for consumer products,” Toshiba said in a statement.

“The company will monitor the market and demand to make optimum decisions on its operations and production levels after the turn of the year.”

The woes on the DRAM segment continue even now, despite hopes that prices were finally stabilizing.

In fact, they fell by yet another chunk during the second half of November, 8%, leaving all hopes that demand was finally picking up in the dust.

In such a context, it would have been dangerous if Toshiba had not acted.