Hitachi plans revamp to save $5b

Consumer electronics giant Hitachi will undergo a major restructuring in an attempt to cut costs by 500 billion yen ($5 billion).

The company's consumer business group and its automatic systems group will be spun off into separate, 100% owned subsidiaries. The company hopes to expedite decision-making and hold these units accountable for generating earnings, Hitachi said.

The consumer business division will produce mobile phones, flat panel TVs and other electronic devices.

Hitachi has also initiated a board shake-up, announcing its chairman and president will both stand down and appointing Takashi Kawamura to take both jobs.

The company said it will also establish a renewable energy business, as well as a resource recycling business.

Hitachi is expecting a 700 billion yen loss for the year ending in March, marking its third consecutive net loss, the Financial Times said.

Hitachi shares on the NYSE climbed 3.48% to $27.06 in yesterday's trading, but fell 1.92% on the Nasdaq to $27.48.