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Panasonic focuses on 5% margins for all business groups

Panasonic's financial future isn't as secure as the company would like. Panasonic's finance chief said this week that about 1/5 of the company's 88 business units are losing money. The finance chief went on to say that only of those 88 units meet the company's target of at least a 5% operating margin.

Panasonic is set to make moves to address the shortcomings in some of its business units with another round of significant layoffs. The company intends to lay off 10,000 workers by the end of March 2013. Panasonic already cut roughly 36,000 workers during its last business year, although some of the jobs Panasonic eliminated were through the sale of businesses.

"Our new boss has said businesses must achieve at least a 5 percent operating profit target within three years," Kawai said, referring to Kazuhiro Tsuga, who took over as company president in June. "But we won't wait that long to tackle units that need to be dealt with."

Panasonic will begin selling off other business segments and closing some of its businesses as early as next year. Panasonic's Hideaki Kawai said that the company intends to earn a group operating profit of at least $2.52 billion in its fiscal year ending March of 2014.

Panasonic warned recently that it would lose close to $10 billion in its fiscal year ending in March of 2013. Panasonic announced $5.5 billion in losses during Q3 of 2011 alone, so things appear to be getting better. 

Source: Reuters



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taxing times.
By drycrust3 on 11/14/2012 9:49:33 AM , Rating: 2
quote:

"Our new boss has said businesses must achieve at least a 5 percent operating profit target within three years," Kawai said, referring to Kazuhiro Tsuga, who took over as company president in June.

quote:
The company intends to lay off 10,000 workers by the end of March 2013. Panasonic already cut roughly 36,000 workers ...

I realise America has different laws from New Zealand, where I live, but I'm wondering if employees should be a tax deduction, like advertising and company cars. In this case, if employees were a tax deduction then laying off staff would increase the amount of taxes a company owes, while employing extra staff would decrease the amount of tax, thus simply laying off staff to balance the books wouldn't necessarily achieve that result.
Sure, it isn't the way one normally expects the economy to work, but if you look ahead you can see it is only a matter of time before pretty well all jobs become computerised, even that guy Kawai's job looks like it's a prime candidate for a computer program.




RE: taxing times.
By tng on 11/14/2012 10:25:18 AM , Rating: 2
quote:
if employees were a tax deduction then laying off staff would increase the amount of taxes a company owes, while employing extra staff would decrease the amount of tax, thus simply laying off staff to balance the books wouldn't necessarily achieve that result.
Interesting idea, but then you would just force companies who already have fiance issues fewer ways out.

In the end most business will just factor in a plan like that into the cost of doing business and nothing will change.


RE: taxing times.
By ebaycj on 11/14/2012 12:48:10 PM , Rating: 1
I don't know.

It seems to me the only thing that most CEO's hate more than their own workers is paying taxes.

It would make them squirm a bit for sure.


RE: taxing times.
By zephyrprime on 11/14/2012 1:17:51 PM , Rating: 2
employees are already a tax deduction since they are an expense. Laying off workers is already a tax increase. Most companies that are laying off workers are paying no taxes anyway since they are not profitable so this is not an issue.


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