Panasonic ride on lithium-ion batteries

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Panasonic, the world’s leader in  lithium-ion batteries for cars, to increase production in Japan, China and the U.S. as it looks to ride an accelerating global shift to electric vehicles. Investments in additional capacity at all three production bases could reach 100 billion yen ($881 million).

The Gigafactory, a massive battery plant in the U.S. state of Nevada jointly operated by Panasonic and Elon Musk’s Tesla, remains a work in progress even after coming online, with new production lines still being set up. The American electric automaker, eager to ramp up output, is discussing a second round of construction with Panasonic that reportedly would increase capacity by as much as 50%.

Panasonic making hectic  expansion is  underway at a plant in Dalian, China, an aims to bring on stream by the end of March. Panasonic is expected to spend colossal amount million dollars to add a second production line slated to begin operation as early as next year  which will initially be able to churn out batteries for several hundred thousand vehicles a year.

Panasonic in line of  making automotive batteries at a liquid-crystal-display plant in Himeji, near Kobe, in fiscal 2019 this is  to cost several hundred million dollars.

The expansion spree in the consumer electronics group’s paramount  to business-to-business operations. The home appliances still deliver a steady stream of profits, prospects for growth in the Japan-focused business are dim.

Electric vehicles show more promise. As automakers worldwide shift from combustion engines to electric power, their competitiveness will be partly determined by battery capability.

Panasonic boasts a roughly 40% share of the global market for lithium-ion batteries used in passenger cars. Chinese government-supported rivals are rapidly gaining ground in a field formerly dominated by Japanese and South Korean players.

Panasonic on future high note could find its  operating profit at the manufacturer’s automotive and industrial systems division, which includes car batteries, is projected to grow 70% from fiscal 2016 to fiscal 2018, reaching 160 billion yen. The Himeji plant in Japan will continue to make LCD panels for medical equipment, but its new focus will be batteries.

Panasonic thus takes a leap in the manufacturing in its vision with massive investment plans  to retain its competitive edge by expanding capacity across the three key electric-vehicle markets of China, the U.S. and Japan.

Panasonic painful journey  about overspending in the 2000s, during the transition from cathode-ray tube televisions to flat-screen TVs, it spent heavily on production of its own plasma and LCD panels. Panasonic could not retain leadership  out of both after failing to keep up  with big-spending South Korean rivals. Panasonic’s TV-related sales, including panels, shrank from more than 1 trillion yen in fiscal 2009 to just over 300 billion yen in fiscal 2016.

 

Inputs ;asia.nikkei.com reports

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