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Panasonic Corporation (Japan)

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Like all Japanese electronics manufacturers, Panasonic has suffered a dramatic collapse in sales of its most profitable products - TVs and components - as a result of brutal competition from more agile foreign competitors, especially Samsung. That threat added new urgency to a steady restructuring that has been going on for several years. In fact, until a change of name in 2008, Panasonic was just one of the brands controlled by what was then Matsushita Electric Industrial, alongside National, JVC and Technics. Together these brands made Matsushita the world's biggest consumer electronics company for much of the 1990s and early 2000s (ahead even of local rival Sony). However, the marketplace began to change dramatically mid-2000s, forcing MEI to change its strategy. To avoid the confusion caused by its multiple brands, the group announced in 2008 that it would change its corporate title to Panasonic Corporation, and phase out its smaller brands. The group still makes a wide variety of consumer electronics products - including Viera flat-screen TVs and Lumix digital cameras - but it sees a brighter future in less high-profile areas such as automotive components, domestic energy systems and B2B technology solutions.


Click here for agency account assignments for Panasonic from Adbrands.net. Including unmeasured media, the company declared advertising costs of Y104.2bn ($868m) in the year ending 2016.


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Brands & Activities

Despite the intense competition within the electronics industry in the 2000s, Matsushita refused to be diverted from a steady restructuring of its core businesses areas. It is now a far more traditional manufacturer than its domestic rivals, steering clear of high-risk, often fashion-led areas such as computer games consoles, MP3 players, or entertainment content. It learned its lesson here from unsuccessful forays into the entertainment industry and home entertainment systems in the 1990s. Despite a broad global profile, Panasonic has remained heavily reliant on its domestic market, and that conservative, unflashy approach arguably allowed Korean rivals to steal share in core segments such as flat panel TVs and DVD recorders. One key advantage Panasonic had over some Japanese competitors, is that it retained a significant presence in more mundane electrical products such as small home appliances, which have faced less dramatic erosion from the likes of Samsung.

During the 2000s, the old Matsushita group finally acknowledged that its sprawling bureaucratic structure stood in the way of efficient growth and development. As a result the group began slimming itself down, taking full control of a number of previously standalone subsidiaries and placing renewed emphasis on its core business. It has also announced a new strategy to become the world leader in the electronics industry in "green innovation", such as renewable energy systems, and also to drive up the proportion of sales generated outside Japan.

Until comparatively recently, the group's products were marketed under several brands. Panasonic was the main international badge, used across all products in Western markets. The same or similar products were marketed in Japan and some other Asian markets under the well-established National brand name. However the group gradually phased out the National brand by 2010 and unified all products under the main Panasonic name. The Technics brand was originally introduced in the 1970s for a range of high-end audio speakers and was gradually expanded to become a second worldwide brand for hi-fi audio products and electronic musical instruments. It too has been replaced for the most part by the main Panasonic banner, although it is still used for some hi-fi products. In addition, the group had used the Quasar name, acquired from Motorola in 1974, for a range of colour TVs, VCRs and microwave ovens marketed in North America. The group spun off another subsidiary, JVC, in 2008, but absorbed part-owned Sanyo in 2009.

The most familiar of Panasonic's divisions, especially in the international market, was Audio Video & Communications (AVC) Networks division. Conscious that it had been surpassed by Sony in areas of design and style, the company strengthened its brand message in 2003, positioning Panasonic under the slogan "Ideas For Life", and highlighting its goal of "enriching the quality of people's lives worldwide". This led to the introduction of a selection of what it called "V-Products" designed to establish Panasonic as a leading force in home and mobile audio-visual networking. Key amongst these was its Viera range of flat-panel TVs. However, like other Japanese manufacturers, it has suffered steep falls in sales as a result of the brutal competition from Samsung and LG. It was overtaken for the first time in the PDP or plasma segment at the end of 2011 by Samsung, already clear leader across the whole market. For full year 2012 Panasonic ranked #4 overall behind Samsung, LG and Sony, with 6.0% share by value (Display Search figures). As a result, it pulled out of PDP altogether in 2013 in order to focus solely on LCD screens, and has continued to scale back its TV business to focus on the most profitable products.

Finally in 2013, the existing AVC Networks division was broken up, with the bulk of its home entertainment and other B2C operations merged into a sister division which developed home appliances, such as air-conditioners, retail cold storage units and chill cabinets, as well as refrigerators, washing machines, rice cookers and other kitchen appliances, vacuum cleaners and beauty appliances (shavers, hairdryers etc). It is the long-established leader in this field in Japan (with around 60% share of the domestic dishwasher market, for example), and has a growing presence in China and other Asia Pacific markets. As a result, the enlarged Panasonic Appliances division combines these white goods domestic appliances with what remains of the home entertainment brown goods devices, including TVs, DVD players and audio equipment. The enlarged Appliances division reported sales of Y2,027bn ($16.9bn) in the year to 2016. Air-conditioners formed the single biggest business line, with sales of Y466bn ($3.9bn), ahead of finished TVs (Y351bn or $2.9bn), laundry and vacuum devices and refrigerators.

The new slimmed down AVC Networks business is mostly concerned with business customers. For example, the company was formerly one of the top three handset manufacturers in Japan. However, it has seen its market share decline dramatically as a result of growth from Apple, Samsung and LG. A key flaw was Panasonic's very late entry into the smartphone market - it didn't launch its first until 2011. As a result, it quit this segment as well in 2013 as far as B2C customers are concerned. Panasonic was also active in laptop computers, and had become best-known for its lightweight and durable Toughbook field notebooks, designed to resist damage when dropped, and featuring waterproofed keyboards. As a result, what remains of Panasonic's Mobile business was aligned with the computer division to develop more durable portable mobile phones and Toughpad tablets targeted mainly at B2B customers.

The main consumer-facing division still within AVC is Panasonic's camera and camcorder business. The group was a late entrant in the digital camera market, but has made up much ground with its Lumix range, which claims to offer superior results through the use of proprietary image stabilisation technology. In 2010, it overtook Kodak to become the global #5 in digital still cameras, according to researcher IDC, although it was still in 6th place in the US market. The AVC group also houses LCD display components for sale to external customers. Combined sales from AVC Networks for the year to 2016 were Y1,040bn ($8.7bn).

Until comparatively recently, the group was also the ultimate parent for more than 50 years of another electronics company, JVC, a pioneer in video recording systems which had developed a similarly broad range of consumer and professional AVC products. Following a complete restructuring in 2002, JVC focused its attention on a greatly reduced range of consumer products led by high-definition TVs, digital camcorders, MP3 audio systems, DVD recorders, as well as components and storage media. Nevertheless, revenues continued to fall steadily. Rumours began to circulate in 2007 that Matsushita was considering ways of divesting its shares in this business. It reduced its shareholding in the business from majority to control to around 37%, and rival electronics company Kenwood acquired a 30% holding in the business in partnership with a private equity backer. JVC and Kenwood merged at the end of 2008 to form JVC Kenwood Holdings. Panasonic retains a 28% shareholding.

Having effectively spun off JVC, Panasonic then agreed terms to acquire control of another smaller competitor, Sanyo for around $9bn. That company, also based in Osaka, was originally launched by the brother-in-law of Panasonic founder Konosuke Matsushita. It was already a leading force in solar cells and rechargeable batteries. These were combined with the group's existing energy-efficient lighting businesses to form Panasonic Ecosolutions, focusing on green energy creation, storage and management systems. It is one of the global leaders energy-efficient lithium-ion batteries and solar cells. One of its most significant customers is electric car manufacturer Tesla, whose batteries it supplies. Eco-solutions also now incorporates what was previously a separate business manufacturing prefab housing systems. Combined sales for ye 2016 were Y1,367bn ($11.4bn).

All the group's other components and electrical engineering divisions were combined. The company is also among the global leaders in automotive electronics, including in-car entertainment, navigation systems (under the Strada sub-brand), and electronic toll collection systems. Growth areas for future development include healthcare devices ranging from hearing aids and home glucose monitoring systems to hospital equipment; as well as security systems. This is now the group's single largest business with combined sales of Y2,540bn ($21.2bn) in ye 2016. More than 40% of revenues come from automotive systems.


Group revenues peaked in the year to March 2007 at Y9,107bn before being driven down year after year by a combination of fierce competition, especially from Samsung and LG, exchange rates, recessionary pressures and natural disasters. By year ending March 2013 they had slumped to Y7,303bn ($88.0bn), the lowest figure since 2002. After reporting a record loss of Y772bn in year ending 2012, there was only a small improvement to a loss of Y754bn ($9.08bn), its fourth net loss in five years. That figure included another substantial charge for restructuring, redundancies and impairments, as well as a write-off of accrued tax assets.

The group finally struggled back into profit for the year ending 2014, with a surplus of Y120.4bn ($1.2bn). Revenues also edged up to Y7,737bn ($77.2bn) an improvement on the previous year but still well below past performance. There was modest improvement in ye 2015.

For the year to March 2016, revenues slipped back to Y7,554bn as a result of lower sales across several segments. However net income rose 8% to Y193bn. Sales within Japan accounted for 48% of revenues, the US for 15%, China for 13% and the rest of Asia 14%. Europe generated 9%.

Management & Marketers

Kazuhiro Tsuga became group president of Panasonic in Summer 2012. Shusaku Nagae is now chairman. The founder's great grandson Masayuki Matsushita is vice chairman and executive advisor. Although the company has been public since 1971, it retains a strong family tradition. Other senior executives include Hideaki Kawai (senior managing director & CFO), Kazunori Takami (EVP, Japan, customer satisfaction & design), Tamio Yoshioka (president, ecosolutions), Yoshio Ito (president, automotive & industrial systems), Tetsuro Homma (president, appliances company), Yasuji Enokido (president, AVC Networks). Marketing is led by Yukio Nakashima (SVP, alliances & director, consumer marketing, Japan). Satoshi Takeyasu is executive officer, corporate communications & advertising.

Regional heads include Joseph Taylor (chairman & CEO, North America), Laurent Abadie (chairman & CEO, Europe & CIS), Hidetoshi Osawa (chairman, China) and Yorihisa Shiokawa (managing director, Latin America).


The company was founded by Konosuke Matsushita in 1918 as Matsushita Electric Housewares Manufacturing Works. Its first product was a humble electric plug, but by the close of the 1920s, Matsushita was also turning out battery-powered bicycle lamps, electric irons and other small appliances, and changed its name to Matsushita Electric Manufacturing Works. In the 1930s, Matsushita moved into the manufacture of batteries, and spun off the electric lamp business as National, the forerunner of the Panasonic brand.

The Second World War brought inevitable disruption, but by the start of the 1950s Matsushita had expanded its range to produce washing machines, televisions, refrigerators and other larger household appliances, many of them exported to the rapidly expanding US market. In 1953, the company opened a New York office, and the following year acquired control of the Japanese subsidiary of RCA Victor, the Japan Victor Company generally known as JVC. Osaka Precision Machinery Co, later to become Matsushita Seiko, was established in 1956. The Panasonic brand was first introduced in Japan in 1955 for audio speakers, and launched internationally in 1961. By the mid-1960s the company was Japan's largest manufacturer of domestic appliances.

That decade, MEI took its first steps into video technology. The company had been producing tape recorders since the 1950s, and began to turn its attention to recording video output. The first Matsushita video tape recorder was developed in 1964, but the real advances came from the group's subsidiary JVC. Originally set up in the 1920s to make records and phonographs for the Japanese market, JVC shifted its focus towards video systems during the 1960s. In 1976, the company launched its own Video Home System (VHS) for videotape, in competition with a rival format developed by Sony, called Betamax. A fierce war ensued between the two formats, especially after Panasonic put its full weight behind VHS, and that system quickly achieved prominence in Europe. However, Sony's Betamax struggled on in the US. At the close of the 1980s, both companies raised the stakes by acquiring US-based film studios in an attempt to win the war by owning video libraries they could market exclusively in their own format. In 1990, MEI bought the MCA Group, which included the Universal Pictures business. A few years later, the Betamax format was effectively terminated by Sony. However MCA Universal was never a particularly comfortable fit, and MEI sold on an 80% shareholding in the business to Seagram in 1995, making a huge loss on the disposal. (The remaining shares were sold to Vivendi Universal in 2006).

In the mid-1990s, MEI turned its attention to the new DVD format, as well as to digital television. The company shipped the first DVD player in 1996, and exported its first digital TVs to the US in 1998. In 1999, Matsushita became one of the partners in British company Symbian, launched by handheld computer group Psion to develop software for next-generation mobile telephones. Motorola, Nokia and Ericsson also all adopted the operating system in their products. Also in 1999, Panasonic unveiled the WiLL PC, part of its involvement in the unique WiLL marketing project in which a group of leading Japanese companies agreed to market a range of lifestyle products under a shared brand.

In 2001 Matsushita merged its LCD display and cathode ray tube (CRT) parts purchasing businesses with those of Toshiba in a joint venture. The group also closed a number of loss-making subsidiaries around the world, including mobile phone and fax machine operations in the UK and other countries. It later merged its CRT manufacturing operations with Toshiba as well. In 2003, in a bid to focus and consolidate its portfolio, the group bought back full control of several subsidiaries previously part-floated, including its battery manufacturing, lighting, mobile communications and other businesses. PanaHome, a division manufacturing and marketing prefab housing, and office automation subsidiary Matsushita Electric Works, were merged into the main group in 2004.

Last full revision 14th December 2016

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