The DELL recall battery SONY losses could reach $430 million

August 16th news analysts said, DELL recalled 4 million 100 thousand pieces of notebook computer batteries have defects in the world, will enable the Sony Corp to pay $85 million to $430 million price, short-term profit to the influence of Japanese electronics manufacturers. "Because these batteries are produced by SONY, the impact on SONY is sure to draw attention." Nomura securities analyst Eiichi Katayama said. He said the impact of the incident is likely to continue to expand.

SONY is now trying to revitalize its electronic products business with its Bravia brand LCD TV and Cybershot digital cameras, in which SONY is facing intense competition from Samsung Electronics and SHARP.

DELL said on Tuesday that it was the largest recall in its 22 year history, saying that SONY's lithium-ion batteries could smoke and fire.

Although analysts estimated the recall from a broad cost, but most analysts pointed out that SONY's battery supply business in the share of its overall operating in a very small proportion, even if the company eventually lost orders DELL and other customers will not be too big.

Macquarie analyst David Gibson expects SONY's battery business accounted for about 3% of SONY's total sales of electronic products business, the company's operating profit in the proportion of about $6%.

Gibson expects the recall will make SONY net profit for the full year is expected to reduce 1523%.

A spokesman for SONY said SONY is still assessing the financial impact of the recall.

The spokesman added that no decision has been made about whether SONY will bear all the costs associated with the recall.

U.S. Consumer Protection Agency officials said on Tuesday that they are on the production of all SONY's lithium-ion batteries used in notebook computers to check in order to prevent the occurrence of fire accidents.

In addition to DELL, SONY lithium ion battery is also used in HP, apple and Lenovo notebook computers.