SONY PLANS to spend 120 billion yen (€1.1 billion) next year to double production of advanced image sensors used in digital cameras and mobile phones, even as it steps back from in-house manufacturing in other parts of its business.

The Japanese consumer electronics group said it planned to expand image-sensor production to 50,000 units a month in the financial year beginning in April, up from a present level of 25,000.

The investment stands out amid a restructuring that has seen Sony shed far more bulk than it has added. Under Sir Howard Stringer, chief executive, the company has cut thousands of jobs, closed four of its eight television factories and outsourced production to lower-cost Asian suppliers.

Half the Sony brand TVs sold worldwide will be built by other manufacturers by the end of March, according to Sony estimates, compared with 20 per cent in March 2010. Sony hopes the shift to an “asset-light” approach will revive a television business that has been in the red for seven years.

At the same time, however, Sony is sticking with a more traditional manufacturing model in areas where it feels it has a competitive advantage over rivals.

Hiroshi Yoshioka, executive vice-president in charge of the company’s consumer electronics divisions, last week identified cameras as one of those areas.

Sony supplies high-end CMOS (complimentary metal-oxide semiconductor) image-sensing chips to other electronics groups, in addition to installing them in its own Handycam camcorders, Cybershot still cameras and Sony-Ericsson phones. – Copyright The Financial Times Limited 2010