Panasonic decided to negotiate with Chinese rival TCL, the world third largest TV maker, to handle its outsource production, after considering many major manufacturers, according to Nikkei Asia Review.
It said the development of low-end TVs, which have low margins, will be outsourced to cut costs.The company has followed other leading Japanese brands in scaling down TV production - an area formerly a major competitive advantage for the country's electronics industry. Panasonic will continue to produce its own high-end TVs, mainly for sale in Japan. However, the company will also consider consolidating or shrinking production locations at home and abroad.
Japanese media outlet Kyodo News
wrote in an article published last Friday: "Panasonic's TV business has been struggling due to fierce competition from Chinese and South Korean rivals."Panasonic used to hold 10 percent of the global TV market share but gradually lost its appeal when low-cost competitors from China appeared. Previously, Panasonic withdrew from the plasma TV segment, and discontinued production in the U.S. and China.According to British research firm Omdia, by 2020, Panasonic ranked 12th worldwide in TV shipments with a 1.8 percent market share.Sales and production of TVs account for less than 10 percent of Panasonic's total revenue. This segment was profitable in the fiscal year ending March 2021 thanks to strong development of the domestic market.However, the company soon found the opportunity to earn long-term profits from TVs is no longer stable. They were forced to restructure their businesses, similar to many other Japanese brands.
Previously, in 2012, Japanese electronics firm Hitachi terminated its domestic TV production and sold its entire brand in 2018. That same year, Japan's electronics maker Toshiba also sold all of its TV assets to China's electronics maker Hisense Group. Meanwhile, Sony has restructured its business model by reducing sales channels and some inefficient product lines.
Panasonic annually sells about six million TVs worldwide.
In Vietnam, Panasonic has eight companies, including Panasonic System Networks Vietnam in Hanoi which specializes in products for the export market like phones, projectors and others, and refrigerator and washing machine factories, an R&D center scattered across different locations, from Hanoi to central Da Nang and southern Ho Chi Minh, Can Tho cities.