Image via CrunchBaseJapan's Panasonic Corp. will have to go through a very difficult time this year due to the disturbing earthquake in March, 2011. Their sales are constantly being held up by the disaster, which their executives claim is expected to continue till September. The company will also be conducting 17,000 job cuts until March 2013 in almost equal numbers throughout the company’s local and foreign operations, informed the President, Fumio Ohtsubo, on Friday.He estimated that due to the unimaginable loss by earthquake and pow
er shortages in the time of summer, it is not likely that that the demand will rise for the company. Ohtsubo said "On April 28, we forecast the disaster would cut first quarter sales by several hundreds of billion yen." He claimed that "At this point we see it as less, possibly half or a third of what we thought. But the second quarter will not be much better, because of the lingering difficulties with the supply chain." The factories of Panasonic in the most affected northern region of the country are almost repaired but still not in the full operating condition. "Basically, I have the strong sense that the 2011/2012 financial year will be extremely tough," he declared.
Just last month Panasonic made an announcement disclosing that their operating profit has risen by 60 percent for the previous year ending in March. Though the officials did not announce any forecast of the current year due to the inadequate information of the last month's upsetting earthquake and tsunami, further worsened by the ongoing nuclear crisis since then. Ohtsubo hoped the company will be able to present its full-year forecast along with the results of its first quarter, which according to last year will be around the end of July.
The main competitors of Panasonic in the flat-screen television market, South Korean Samsung Electronics and LG, are both attempting to concentrate more on environmental and energy-related manufacturing such as rechargeable batteries. Adopting the same strategy, Panasonic also declared last year that it will pay $9.4 billion to own Panasonic Electric Works and Sanyo Electric Co completely, giving it the direct command of tens of thousands of more workers.
Panasonic has altered its business strategies as it now becomes more eager to adopt businesses like home appliances, air conditioning, projectors and surveillance cameras, along with head office and back office functions.
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