Panasonic may close businesses to avoid losses

PanARMENIAN.Net - Panasonic Corp., Japan’s largest consumer-electronics maker, said it’s in talks about closing some businesses as the company heads toward a second straight annual loss, Bloomberg reported.

Shutting divisions is a “worst-case” scenario and the TV maker will try to safeguard jobs whether units are sold, restructured or closed, President Kazuhiro Tsuga told reporters late January 8 at the Consumer Electronics Show in Las Vegas. He didn’t elaborate on which operations could close.

Panasonic needs to overhaul unprofitable operations such as plasma televisions and mobile phones to end losses, said Junya Ayada, a Daiwa Securities Co. analyst. The Osaka-based company eliminated more than 38,800 jobs in the year ended September, or about 11 percent of staff, as Japanese electronics makers struggle to compete with Apple Inc. and Samsung Electronics Co.

“The market is expecting Tsuga to come up with a drastic and convincing plan,” Tokyo-based Ayada said by phone today. “He needs to show specifics on how to revive the company.”

Discussions about shutting units form part of work on a mid-term plan due to be unveiled by March 31, Tsuga said. The company has no immediate closure plans, he said.

“We really want to avoid it,” he said. The company may instead find partners or form ventures for units, possibly including the semiconductor business, he said.