Panasonic Corporation Business Report FY ended Mar. 2014

Business Highlights

Financial Overview

(in millions of JPY)
  FY ended Mar. 31, 2014 FY ended Mar. 31, 2013 Rate of
Sales 7,736,541 7,303,045 5.9 -
Operating income 305,114 160,936 89.6 -
Net income 120,442 (754,250) - -
Automotive & Industrial Systems
Sales 2,585,690 2,359,275 9.6 -Sales increased year-on-year due to a rise in sales of in-vehicle infotainment systems. Sales were also supported by favorable currency translation due to weaker yen.
Operating income 85,747 29,458 191.1 -Operating income increased year-on-year due to a rise in sales of automotive products. Weaker yen also contributed to the improvement.

Business Plans for Fiscal Year Ending March 2015

-The Company aims to establish a solid foundation to achieve goals set in the Cross-Value Innovation 2015 (CV 2015) mid-term strategy that covers April 2013 through March 2016, while designing a new growth strategy for the creation of a new Panasonic by 2018.

Establishing solid foundation to achieve CV 2015 goals
-Strengthening the functions of each business division by delegating management responsibilities to respective business units. Accelerating effort to acehive operating profit margin of 5 percent by the fiscal year ending March 2016.

Designing new growth strategy for the creation of "new Panasonic" by 2018

-The Company aims to develop and improve the profitability of the following business areas: the home electronics business; the housing business; the automotive business; the BtoB solutions business; and the electric device business.

Sales targets for 2018:
Expanding the home electronics business, the housing business, and the automotive business to a 2-trillion yen business, respectively.
Generating JPY 2.5 trillion at the BtoB solutions business
Achieving JPY 1.5 trillion at the electric device business

<Automotive Business>
-In addition to supplying cylindrical lithium-ion batteries to a US-based electric vehicle manufacturer, the Company will heavily invest in the development and production of square lithium-ion batteries to expand the business segment.

-The Company aims to differentiate its products from its competitors in the area of infotainment systems. It will focus on the development of  high-performance head-up display systems and cockpit systems by leveraging its expertise in digital audio/video technologies and information technologies.

HV Battery Joint Venture in China

-In 2013, Toyota Motor Corporation (TMC) established a joint venture (JV), Sinogy Toyota Automotive Energy System Co., Ltd. (STAES), to produce hybrid batteries in China. This is the company's first hybrid battery plant outside Japan. STAES is capitalized at USD 9.75 million (JPY 960 million). The equity share ratio is as follows: 50% by Changshu Sinogy Venture Capital Co., 35% by TMC, 10% by Primearth EV Energy Co., Ltd.(a JV between Toyota and Panasonic), and 5% by Toyota Motor (China) Investment Co., Ltd. The plant will have an annual production capacity of 110,000 battery units and will start operations in 2015. The total investment into the JV will be USD 24.37 million (JPY 2.4 billion). The new JV was established on November 12. On the same day, a ceremony was held to celebrate the completion of R&D facilities belonging to Toyota Motor Engineering & Manufacturing (China) Co., Ltd. (TMEC) in the same industrial zone. The plant is a part of the company’s initiative to accelerate development of localized hybrid units by TMEC.(From an article in the Nikkan Jidosha Shimbun on November 15, 2013)


-In 2013, the Company and Tesla Motors announced that the two companies have reached an agreement, under which Panasonic will expand its supply of lithium-ion battery cells to the electric vehicle manufacturer. Panasonic will provide approximately 2 billion cells to Tesla during the four year period between 2014 and 2017. The battery cells will be produced at Panasonic's Automotive and Industrial Systems Company (AIS). AIS will boost its production capacity by investing an extra JPY 18 billion in addition to its JPY 13 billion expansion project, which was decided by March 2013. Plans include increasing the production capacity at the Suminoe Plant in Osaka by transferring manufacturing lines from the Wakayama Plant, and resuming production at the Kaizuka Plant in Osaka, which is suspending its operations. (From an article in the Nikkan Jidosha Shimbun on November 6, 2013)

In 2013, the Company announced that it will supply its nickel-metal hydride (Ni-MH) battery systems for Fuji Heavy Industries' Subaru XV Crosstrek Hybrid for sales in the U.S. market. The new hybrid model will be unveiled at the New York International Auto Show taking place from March 27 through April 7, and is scheduled to be released in the fall of 2013. (From an article in the Nikkan Jidosha Shimbun on Apr. 5, 2013)


-In 2013,  its Supplier Award winners, including Panasonic Factory Solutions Co., Ltd. received the Supplier Award in the category of Indirect Purchasing from the Bosch Group. (From a press release on July 4, 2013)xxxxx

Total Shipments of Lithium-ion Battery Cells

-In 2013, the Company announced that it will mark the shipment of the 100 millionth lithium-ion battery cell for the Tesla Model S electric vehicle in June. Tesla Motors released the Model S in 2012, and sales are expected to exceed more than 20,000 units this year. The 18650 size cylindrical lithium-ion battery cell with the highest energy density and performance in the industry is optimized for use in electric vehicles. Having been developing electric vehicle battery cells together with Tesla, Panasonic also supplies its battery cells for the Roadster as well. By accelerating the development and commercialization of high-performance batteries, the company is poised to expand its green-car battery business in the global market. (From an article in the Nikkan Jidosha Shimbun on Jun 13, 2013)

Outlook for FY ending Mar. 31, 2015

(in million of JPY)
  FY ending Mar. 31, 2015
FY ended Mar. 31, 2014
(Actual Results)
Rate of Change
Sales 7,750,000 7,736,541 0.2 -
Operating income 310,000 305,114 1.6 -
Net income 140,000 120,442 16.2

>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)


R&D Expenditure

(in millions of JPY)
  FY ended Mar. 31, 2014
Overall 478,800
AVC Networks
Automotive & Industrial Systems 170,000

Product Development

<Automotive & Industrial Systems>
-The Automotive & Industrial Systems Company develops multimedia products for automobiles, secondary batteries, electronic components and electronic materials.

High-brightness white light source
-The Company developed high-brightness white light source that uses near-ultraviolet semiconductor lasers and phosphor materials.

Communication LSI
-The Company developed HDMI 2.0-Compliant Communication LSI that enables optimal, high speed data transmission of 4k image data. The new LSI is expected to support various 4k devices including large-screen monitors for broadcast and industrial uses as well as automotive displays.

Bamboo Plant Opal Loudspeaker
-The Company developed a loudspeaker using a diaphragm that is made from resin mixed with bamboo plant opals.

New Automotive Switch
-In 2013, the Company introduced a new automotive switch which can detect the opening and closing of doors or the position of a shift lever. By downsizing its internal contact structure, the company made the new switch 45% smaller and 40% lighter than a conventional switch. The new switch offers improved flexibility in vehicle design and mounting options. The new product can be used not only for gasoline-powered vehicles but also for hybrid and electric vehicles, which have strict noise requirements. AIS intends to market the product in China and other emerging countries in Asia. The company’s Ise Plant in Tamaki, Mie Prefecture, will produce 1.5 million switches per month. (From an article in the Nikkan Jidosha Shimbun on December 12, 2013)

Inverter Microcomputers
-In 2013, the Company developed high-performance inverter microcomputers that can simultaneously control inverters and converters of onboard equipment. Generally, different microcomputers separately control inverters and converters. The newly developed inverter microcomputer can also control the converter, which enables simultaneous control of the motor and power supply. This leads to a 40% reduction in processing time of the overall system. Mass production will begin in December 2013 at the Hokuriku Plant in Myoko City, Niigata, Japan. One million microcomputers will be produced a month. (From an article in the Nikkan Jidosha Shimbun on December 11, 2013)

Millimeter-wave Radars
-In 2013, the Company announced that it developed a new technology for higher precision, wider-angle millimeter-wave radars for use in automobiles. The technology can separately detect vehicles, pedestrians, and bicycles 40 meters away within 0.1 seconds provided that they are separated by 20 centimeters. Panasonic will apply this technology to 79 GHz radars to develop detection sensors to prevent accidents occurring at intersections. (From a press release on October 15, 2013)

Power Choke Coils
-In 2013, the Company announced that it developed the PCC-M0530M/PCC-M0540M power choke coil series for use in power supply circuits of automotive electronic control units (ECUs). The new power choke coils, which have a low DC resistance, are 40 percent smaller than the company's conventional models and serve to reduce the size of power supply circuits. The new series also improve the efficiency of the power supply unit with low loss, and thus are suitable for large current applications. In addition, they achieve a heat resistance of 150 degrees Celsius for 2000 hours. The high resistance of the coils allows a simpler circuit to be designed. The new power choke coils will be widely used in engine ECUs for hybrid, electric and gasoline vehicles and in other automotive ECUs. (From an article in the Nikkan Jidosha Shimbun on October 10, 2013)

12V Energy Recovery System
-In 2013, the Company announced that it developed a 12V energy recovery system for automobiles. The technology is especially designed for use in vehicles equipped with an automatic engine stop-start system using nickel metal hydride (Ni-MH) batteries. Installation of the new energy recovery system will allow the vehicle to store the energy generated during braking into the batteries, and supply the stored energy to its electric components and drive assist motors as a power source. The technology also contributes to improving fuel economy and extending the service life of the main lead-acid battery. (From an article in the Nikkan Jidosha Shimbun on Feb. 9, 2013)

R&D Structure

<Automotive Systems>
Company Location

Automotive Development Center

Yokohama City,
Kanagawa Pref.
e-Cockpit Development Office Kadoma City,

Product Development Center

Yokohama City,
Kanagawa Pref.
Global Fundamental Technology Development Center Yokohama City,
Kanagawa Pref.

Global Production Innovation Center

Matsumoto City,
Nagano Pref.
Panasonic Automotive Systems Company of America (PASA) Georgia, USA
(car audio systems)
Panasonic Automotive Systems Europe GmbH (PASE) Langen, Germany
Panasonic Automotive Systems Development Tianjin Co., Ltd. (PASDT) Tianjin, China
(car audio and car navigation systems)
Panasonic Automotive Systems Asia Pacific (Thailand) Co., Ltd. (PASAP) Samutprakarn, Thailand

Investment Activities

Capital Expenditure

(in millions of JPY)
FY ended Mar. 31, 2014
Overall 217,000
AVC Networks
Automotive & Industrial Systems 85,400

Planned Capital Investments

(As of Mar. 31, 2014)
(in millions of JPY)
Main purpose
Overall 255,000 -
Automotive & Industrial Systems 109,000

Expanding production of secondary batteries

Producing some new in-vehicle multimedia products and electronic components, and expanding their production volumes.