TMCnet Feature

Floods in Thailand and slowing TV business has impact all major Japanese consumer products manufacturers. And Panasonic is one of them. The Japanese consumer giant is forecasting an unprecedented loss for the fiscal year ending in March. As per the report by Reuters (News - Alert), Panasonic is warning of a record annual net loss of $10.2 billion.

On Friday in Tokyo at a press briefing, Panasonic president Fumio Ohtsubo apologized for the unprecedented loss. Reuters quoted the president, as saying, "I feel the responsibility for the huge amount."

However, as per the report, Ohtsubo gave no indication that he would step down and let someone else take control and rebuild the consumer electronics giant. Under similar circumstances, Sony's boss Howard Stringer stepped aside last year, wrote Reuters’ reporters Tim Kelly and Yoko Kubota. Sony has announced that Kazuo Hirai will take over from Stringer as CEO in April.

Instead, Ohtsubo told reporters at a press briefing that "We will accelerate our profit structure reform and make sure we achieve a V-shaped performance improvement in the next business year," wrote Kelly and Kubota.

Meanwhile, as per the Reuters report, Panasonic (News - Alert) has lowered the shipment numbers for flat-screen TVs by 1 million. Consequently, the company will sell about 18 million sets this year, wrote Kelly and Kubota. Commenting on the Panasonic debacle, CEO and president of Fukoku Capital, which managed assets worth $7.6 billion as of last March, Yuuki Sakurai said, "They don't seem like a company that's progressing towards a particular goal." He added, "What exactly is this company good at? What does it want to do? They don't have answers to these questions."

The Reuters report shows that Panasonic is in the process of cutting 17,000 jobs by end-March. Plus, it has also missed the third-quarter market forecasts, reporting a loss of 197.6 billion yen (US $2.58 billion) from a profit a year earlier. Much of the damage is coming from the TV business, wrote Kelly and Kubota.

According to Ohtsubo, wrote Kelly and Kubota, Panasonic is not running away from the TV business. The Reuters report quoted Ohtsubo, as saying, "I don't think it's a business that has lost its growth potential." Panasonic, he added, “wanted to develop TV in a different manner by exploring growth in sales to businesses, such as high-quality monitors for hospitals, rather than direct to more fickle retail consumers.”

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