Hitachi Ltd, the world's fourth-largest maker of plasma-screen TVS, will sell its plasma displays to other TV makers, including those in China, to turn around its money-losing flat-panel business.
Hitachi plans to sell 500,000 panels to other TV makers in the six months ending March 31 next year and another 1.2 million units in the year ending March 31, 2010, the Tokyo-based company said in a statement yesterday.
Hitachi and rival Pioneer Corp are losing money on plasma-screen TVs as bigger companies including Matsushita Electric Industrial Co, the world's largest plasma TV maker, and No. 2 Samsung Electronics Co offer lower prices and ship more units to retailers.
"Pursuing volume in sales isn't our priority any more," Makoto Ebata, vice president of Hitachi's information and digital media division, told reporters in Tokyo. "Raising profitability is now our priority."
Hitachi cut its full-year profit forecast by 75 percent on Tuesday and said expenses for restructuring its unprofitable flat-panel TV business will reduce earnings by ?30 billion (US$280 million) in the year ending March 31.
Earnings for the six months ended Sept. 30 were reduced by about ?15 billion due to costs related to stopping production at an older plasma-TV panel factory in Miyazaki Prefecture in southwestern Japan.
Hitachi said yesterday it has set an 80 percent utilization ratio for another of its plasma-panel factories in Miyazaki for the year ending March 2010, up from the present rate of less than 70 percent.
Hitachi, which also makes liquid-crystal-display (LCD) televisions, said yesterday it is targeting sales of 3.6 million flat-panel TVs in fiscal 2010.
It aims to sell 2 million LCD TVs in the 12 months to March 31, 2011, and 1.6 million plasma panel sets, Hitachi said.
The company on Tuesday cut its sales forecast for plasma-screen TVs to 900,000 units for the current fiscal year, from an earlier 1.2 million projection.
In the three months ended Sept. 30, the company had a 7.9 percent share of global plasma TV sales, followed by Pioneer's 6.3 percent share, researcher DisplaySearch said.
Matsushita, Samsung and LG Electronics Inc of South Korea account for more than 70 percent of the market.
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