Panasonic Corp plans to close three plants in Asia and axe hundreds of jobs as it braces to slip into the red for the first time in six years, a report said yesterday.
The Nikkei Shimbun said Panasonic — bruised by falling electronics prices and the yen’s rise — is expected to report a net loss of around ¥100 billion (US$1.1 billion) in the business year to March.
Mounting restructuring costs will also push losses higher, the daily said, without citing its sources.
Japan’s electronics giants are facing tougher times after enjoying several years of strong profits, as consumers tighten their purse strings amid recessions in major economies from the US to Japan and Europe. The rising yen has also eroded their export earnings.
Electronics maker Canon Inc said yesterday net profit dropped 37 percent last year and it forecast a further plunge of 68 percent this year because of the global economic crisis.
Canon, which produces cameras and office equipment, logged an annual net profit of ¥309.15 billion, against a year-earlier profit of ¥488.33 billion. For this year it expects a much lower net profit of ¥98 billion.
“The rapid deterioration in the economic environment since the autumn has triggered a global slump in individual consumption. This has caused damage to the digital camera market beyond our expectation,” Canon managing director Masahiro Osawa told reporters.
The Nikkei said Panasonic, which has enjoyed brisk sales of plasma televisions, mobile telephones and digital cameras in recent years, will close two of its three electronics parts facilities in Malaysia.
The two are the Malacca factory, which churns out film capacitors used in mobile phones, and a factory in the state of Selangor, which makes switches for audiovisual equipment.
Panasonic will close the Malacca plant in March with the loss of 500 jobs, it said. The Selangor plant would shut in September, it added, without saying what would happen to the employees there.
A Philippine facility that produces batteries will also be shut in March, with its 60 employees losing their jobs, it said.
Panasonic did not confirm the Nikkei report.
The company said it would announce whether it was revising its full-year forecasts next Wednesday when it releases October-to-last-month results.
In November, the company slashed its net profit forecast for the current financial year by nearly 90 percent, to ¥30 billion.
Panasonic said earlier this month that it would slash investment in flat TVs and exit unprofitable businesses to streamline its operations.