According to the Nikkei News, Panasonic recently signed an agreement with TCL, the third largest TV manufacturer in the world. According to the agreement, TCL will produce most Panasonic cheap TV sets for Southeast Asia and India from next year. The two companies also hope to cooperate in panel procurement and development, which account for a considerable proportion of production costs.
At the same time, Panasonic will end its production in Japan, Vietnam and India before FY 2020, and will close its factory in Brazil this year, and close its factories in Czech Republic and China before the end of March next year, leaving only two factories in Malaysia and Taiwan Province Province of China. The company will continue to produce high-profit products such as organic light-emitting diodes for the Japanese domestic market.
It is understood that Panasonic's TV business suffered losses in fiscal years 20 18 and 20 19. The company concluded that it is unlikely to remain profitable without further restructuring. Outsourcing the production of low-cost models to TCL can make Panasonic's brand appear in front of a wider range of consumers.
Therefore, Panasonic, which has been engaged in TV business since 1952, will reduce its annual TV production to about1000000-only about 5% of its peak output, and its share in domestic TV production will be halved to about 30%. This also marks the further decline of Japanese TV industry as the pillar of its manufacturing industry.
Looking ahead, a Panasonic executive said, "We will only make money quietly where we can make money." But I'm afraid it's not that easy. Hisense, which acquired Toshiba TV business a few years ago, has been expanding its market share. If Panasonic can't achieve its expected stable profits, it may be forced to consider taking more stringent measures.