"Sony plans to reduce the consolidated number of Sony regular employees by about 20,000 over a three-year period. This will include about 7,000 employees in Japan," Sony said in a statement.

It said the total workforce as of March stood at 154,500, excluding the finance sector.

The company said it would implement a second phase of structural reforms of the group, including its electronics, entertainment and other major divisions "to create a highly efficient, high added-value operational structure."

For the three years to March 2007, the company said it planned to spend 335 billion yen (3.1 billion dollars) -- 300 billion yen of it in the electronics sector -- to achieve annualised fixed cost savings of roughly 200 billion yen compared to fiscal 2002.

Sony said it also aimed to achieve a consolidated operating profit margin "of at least 10 percent (excluding the financial business) by the end of fiscal year 2006.

"Sony also believes that these changes will lay the foundation for the creation of new value and significant growth from fiscal year 2006 onwards," the statement said.

Separately Sony and South Korean microchip giant Samsung Electronics announced they had signed a memorandum of understanding to establish a joint venture to produce flat panel television screens in South Korea.

SPACE.WIRE