Toshiba will cease handset production in Japan in an attempt to cut costs in the face of slumping demand.
The company will continue manufacturing phones for the Japanese market from operations in China. Its Hino Operations division, previously in charge of manufacturing handsets, will be retained for product development and design.
Japan\'s mobile industry has been declining steeply since the introduction of a new sales model that has raised handset prices and discouraged consumers from upgrading their phones, Toshiba said. The market slumped around 30% last financial year.
Toshiba posted a record 343.6 billion yen ($3.61 billion) loss for 2008, with revenue declining 13% to 6.65 trillion yen.
The company is Japan\'s sixth largest handset manufacturer, capturing around 7% of the market, Reuterssaid.