Can the "slimming" reform of Panasonic Electric recreate its glory?

Author: Summer The full text is about 1400 words, about 3 minutes to read

In the 1990s, more than 70% of China's color TV companies adopted Panasonic's color TV technology, PANASONIC once became synonymous with color TV, leaving a deep imprint on Panasonic TV in the hearts of a generation of Chinese. Nowadays, with the fierce competition in the market and the shrinking of profits, Panasonic has further "slimmed down" by outsourcing low-end business and closing factories, seeking new opportunities for market development.

According to Japanese media reports, Panasonic recently reached an agreement with TCL that from 2022, TCL will produce most of Panasonic's cheap TVs for markets such as Southeast Asia and India. Panasonic is exiting the production of small and medium-sized televisions with low profit margins, and is looking for development opportunities for the Japanese domestic, European and American markets in terms of high-end models such as large-size LCD TVs and OLED TVs. In addition, the two sides will explore cooperation in the procurement and development of panels.

According to related reports, at present, Panasonic's own tv sets are only about 1 million units a year, and at its peak, Panasonic's own TV production capacity can reach 20 million units a year, and now it is only 5% of the glory days of that year. In recent years, Panasonic's TV business has also not been ideal.

According to AVC Revo, global shipments of Panasonic TVs have continued to decline in recent years, from 5.4 million units in 2019 to 4.3 million units in 2020 and further reduced to 3.6 million units in 2021. According to the financial report, as of fiscal 2019 (April 2019 to March 2020), Panasonic's TV business lost money for two consecutive fiscal years. Although sales and attributable net profit increased in the first half of 2021, this short-lived performance did not affect Panasonic's adjustment reform.

Panasonic's TV business will end production in Japan, Vietnam and India by the end of March 2021, and will close its plant in Brazil in 2021 and its Czech plant by the end of March 2022, leaving only two plants in Malaysia and Taiwan. Panasonic's large-scale closure of factories to outsource the production of small and medium-sized televisions may be Panasonic's main consideration of cost issues and control losses, but it is not difficult to see that with the intensification of market competition, Panasonic further shrinks the front line in the TV business.

Panasonic was once the world's largest tv set, producing television sets since the 1950s. At the same time, tv sets are also the star business that has long led Panasonic's home appliance division. Especially in the era of plasma TELEVISION, Panasonic TV is the king of the market. Until 2000, plasma TVs were a very popular choice for high-quality flat-screen TVs. However, although the plasma display technology is excellent, it also has its shortcomings such as high cost, bulky volume, and high energy consumption. Coupled with the shortcomings of liquid crystal technology at that time, there were not enough product advantages to become the mainstream of the market, resulting in Japanese panel manufacturers being overly optimistic about plasma display technology, especially Panasonic, which mastered the most technology, was optimistic and invested heavily.

However, with the change of consumer demand and the shortcomings of plasma technology in the mobile era more obvious, in terms of advantages beyond plasma LCD TV gradually become the mainstream of the market, the main plasma panel Panasonic TV also inevitably went downhill. In 2011 and 2012, Panasonic suffered two consecutive years of huge losses. In 2013, Panasonic began to lay off employees sharply, close ion factories, etc., panasonic hopes that this series of reforms can stop losses.

At the same time as panasonic reform and adjustment, the market is also undergoing great changes. In recent years, the color TV industry to laser, OLED, ULED, Mini LED and other innovative display technology products have increased in popularity, Hisense, Skyworth, TCL and other domestic color TV brands have joined these high-end market battles, enhance product strength while realizing the influence of their own brands. Especially in laser display and ULED technology, domestic manufacturers even stand on the same starting line with the world's display giants. In the context of the rise of the national tide, the appeal of the Panasonic brand to the younger generation has decreased, and the former brand advantage is facing a severe market test.

With the continuous improvement of the purchasing power of Chinese consumers, higher requirements have also been put forward for the quality of life. Specific to the field of color TV, not only the requirements for TV screen size and display effect are constantly improving, but also the requirements for TV appearance are also continuously improved. In the early days of the rise of the domestic television industry, Panasonic successfully occupied the market high with production capacity and technical advantages, and now withdraws from the production of small and medium-sized television sets with low profit margins, and the focus of research and development and production is on the high-end TV sector. In today's rapid technological innovation, the competition in the high-end color TV product market is particularly fierce, can Panasonic reproduce its brilliance with technical advantages in the future? This waits for time to verify.