Panasonic has long been one of the world's top
consumer electronics firms and is involved in vast and varied markets ranging
from consumer electronics to battery production. The company has been hard hit
with tough competition from other companies in the market and from the massive
earthquake and tsunami that hit Japan.
Panasonic is looking to reorganize
its operations to better compete in the marketplace. The reorganization
will see the electronics company shed 17,000 workers over the next two years.
Currently, Panasonic has about 367,000 workers around the world. It wants that
number pared back to 350,000.
The company has set aside about $1.3 billion (110 billion yen) for
Toru Hashizume from Stats Investment management said, "The
figure [layoffs] is huge, but so is the company, and for an old-fashioned one
like Panasonic, this is a big move."
Shedding workers isn’t the only place Panasonic is hoping to save
money. The company is also going to be combining operations and closing down
manufacturing plants as well. Reuters reports that Panasonic
currently has about 350 manufacturing bases around the world.
Panasonic president Fumio Ohtsubo said, "I can't say for
sure, but I think it's possible we will cut the number of manufacturing bases
by 10 or 20 percent."
Investment analyst from Federated Advisory Services in Tokyo
Masahiro Mitsui told Bloomberg, "Restructuring is
inevitable after the acquisitions. Panasonic needs to boost its competitiveness
even more as the energy-related businesses are getting more and more crowded
with South-Korean and Chinese makers."
The acquisitions includes the $6
billion Panasonic spent last year to buy parts of Sanyo Electric Co. and Panasonic
Electric Works Co. The company already has a deal in place with Tesla to make
battery packs for Tesla's electric vehicles.
Bloomberg reports that Panasonic will halt new investments in both plasma
and LCD display operations to revive profits in the sagging TV unit. Panasonic
will also seek more alliances to purchase LCD panels.