In fiscal 2014, Panasonic completed the restructuring of its television, semiconductor and other loss-making digital businesses. Next, Panasonic will focus on transforming six low-yield businesses such as lighting and batteries.
The two factories under the Panasonic Lighting Systems subsidiary are located in Osaka and Tokyo respectively, and approximately 250 employees will be transferred to other factories. After the two plants are closed, production will be transferred to nearby plants in Iga and Tamba. Panasonic will invest 1 billion yen (US$8.18 million) in automated production at the Iga and Tamba plants. Panasonic plans to increase the production capacity of these two factories by 30%, thereby increasing the overall production capacity of Panasonic lighting equipment.
The Osaka lighting equipment factory was built in 1967, and the Tokyo factory was built in 1990. The two factories mainly produce LED lighting equipment, but the aging of the factories has led to low production efficiency. Panasonic plans to sell the two plants, thereby reducing the number of its domestic factories to 10.
Although Panasonic's lighting business has the largest market share in Japan, lighting equipment manufacturers in developing countries produce products at lower prices, diluting Panasonic's profit margins. In fiscal year 2014, Panasonic's lighting business achieved sales of 317.7 billion yen, but its operating profit margin was only 4.7%, lower than Panasonic's 5% target, so the lighting business became the target of restructuring. Panasonic expects that after the restructuring, its lighting business will achieve sales of 342 billion yen in fiscal year 2015, with an operating profit margin of 6.1%.
Panasonic has also decided to close its LED lighting equipment factory in Indonesia before the end of October this year. In the future, all lighting products sold in Japan will be produced domestically. Panasonic's measures to reform this business also include effective R&D expenditures and a shift to high profitability.
favorable area.
"We completed structural reforms in the last fiscal year," said Panasonic President Kazuhiro Tsuga. "Focusing on these six businesses, our goal is to increase sales and drive profits."
Although Panasonic has taken rapid restructuring measures, such as closing the Beijing lithium battery factory, new problems are also emerging, and the sluggish sales of its air purifiers in China is one of them.
ANNA