Auto windshield maker Nippon Sheet Glass Co. said it will cut 3,500 jobs

Japan Inc. is suffering and the supply chain is bearing the cost.

Auto windshield maker Nippon Sheet Glass Co., which sells to Mazda Motor Corp., said it will cut 3,500 jobs. The yen´s 7 percent surge against the dollar in the past 12 months has widened losses at Sony, Mazda and Sharp Corp., which plans to halve TV production at its biggest factory to reduce inventory. Manufacturers have been forced to both relocate production outside of Japan and to press their suppliers for cost cuts.

“Once giants like Sony and Sharp fail, the entire supply chain falls into the red,” said Mitsushige Akino, who oversees about $600 million at Ichiyoshi Investment Management Co. in Tokyo. “The yen is killing Japan´s manufacturing base.” Nippon Sheet Glass now expects a loss of 3 billion yen for the year ending March 31, compared with a previous forecast of 14 billion yen in profit, it said in a statement yesterday. The Tokyo-based company said the job cuts will cost about 25 billion yen, with an expected benefit of 20 billion yen annually after reforms take effect.

‘Biggest Catastrophe´

...Nippon Sheet Glass plunged by the most in 10 months in Tokyo trading today, falling as much as 13 percent to 131 yen, after announcing its job cuts yesterday after the market closed.

Sony, Samsung

The company blamed a stronger yen, cuts in production caused by last year´s floods in Thailand and the cost of exiting a display-panel venture with Samsung Electronics Co. for causing its estimated annual loss to widen from the 90 billion yen deficit it forecast in November. The loss in the 12 months ending March will be the fourth in a row, a first since the Tokyo-based company was listed in 1958.

Sony, maker of Bravia TVs, has lost ground to South Korea´s Samsung and LG Electronics Inc., both of which sell TVs profitably. Sony and Japanese television makers Sharp and Panasonic Corp. have been crippled by the strengthening yen, which prompted Sharp to predict a record $3.8 billion loss for the year ending March 31.

Hitachi, which already plans to close its remaining television plant in Japan by September, said third-quarter profit dropped a more-than-expected 45 percent.