Panasonic Corp. said on Jan. 9 it will slash investment in flat televisions and exit unprofitable businesses. The company, which has enjoyed brisk sales of plasma televisions, mobile telephones and digital cameras in recent years, said it would undertake "drastic structural reforms" to streamline its operations. It plans to close down overseas operations and business programs that are losing money, although details of the overhaul have not yet been decided.
"The current situation is not just a simple economic slump. Global demand is shrinking and shifting to the emerging markets," Panasonic president Fumio Ohtsubo said. "We cannot expect an easy recovery. We must focus our efforts on structural reform, strengthening our company, and prepare for future growth."
Panasonic said it would reduce investment in two television panel plants to 445 billion yen ($US 4.9 billion), from a previously expected 580 billion yen.
Ohtsubo added, however, that plasma and liquid crystal televisions remain areas of growth, although sales slowed significantly in the second half of 2008.
Panasonic will try to take a 20% share in the global market for thin-screen televisions, he added.
Major emerging nations such as Brazil, Russia, India, China and Vietnam continue to show promising business prospects for televisions and other appliances. The company will continue its efforts to expand international sales, especially in the emerging markets and Europe, where the firm is introducing white goods for the first time.
"Asia is the only one area in the world where we can expect to see sales that will be as good or almost as good as last year," Ohtsubo said.
A recent deal to acquire smaller rival Sanyo Electric should also help Panasonic to cultivate new fields for innovations and synergy, he added.
Copyright Agence France-Presse, 2009