Panasonic Corporation Business Report FY ended Mar. 2016
|(US GAAP, in millions of JPY)|
|FY ended Mar. 31, 2016||FY ended Mar. 31, 2015||Rate of change
|Income before income taxes||217,048||182,456||19.0||-|
|Current net income attributable to the Company's stockholders||193,256||179,485||7.7||-|
|Automotive & Industrial Systems|
|Sales||2,540,754||2,625,351||(3.2)||-Total sales declined due to influence of battery and device related to IT business decreased as well as shrinkage and withdrawal of business, although good vehicles sale pushed up sales in North America.|
|Operating income||102,698||116,390||(11.8)||-Profits decreased due to poor performance of secondary batteries and industrial business.
-The Company will place a particular focus on its automotive systems business with high great potential. At the presentation meeting held in Tokyo on March 31, the Company said it had abandoned the Group's JPY 10 trillion sales target that was planned to be achieved by FY 2018. Sales target at its automotive division was revised to JPY 2 trillion, down JPY 100 billion from the original goal. The Company intends to make upfront investments next-generation cockpit technologies and advanced driving assistance systems (ADAS), which are expected to become its major profit-making products. It will also strengthen its partnership with Ficosa International, S.A. of Spain for expanding its advanced cockpit business. Its development and production resources will be focused on ADAS and automotive batteries. Panasonic's president Kazuhiro Tsuga said that divestiture of business is one of the various options for improving profitability, citing sellout of its lead-acid storage battery business to GS Yuasa Corporation as a decision it made for pursuing future expansion opportunities. (From an article in the Nikkan Jidosha Shimbun on April 4, 2016)
Management index and Business plan of automotive business
-Targeting more than 5% of operating margin and more than JPY 300 billion for business areas of Consumer Electronics, Housing and Automotive after 2020.
-The sales prospect of Automotive business of FY 2018 reduced JPY 100 billion from JPY 2.1 trillion of the first plan and revised it to JPY 2 trillion.
-In the environmental business segment, the Company will take advantage of its wide-ranging battery technologies and power supply device technologies. Mass production of cylindrical lithium-ion batteries is slated to begin in 2016 at a new factory built within the Gigafactory of Tesla Motors of the U.S. (From an article in the Nikkan Jidosha Shimbun on June 12, 2015)
|Reference : Overall Picture toward Automotive Sales (Original plan)
||(Unit: JPY 100 million)|
|Rate of Change
|Strength and Challenge|
|Comfort - Cockpit business||9,300||6,000||55.0||(Strength) -Apply consumer electronics, AV, and mobile technologies to the automotive business.
(Challenge) -Expand new businesses/products whose investment efficiency is high.
|Safety - ADAS business||4,700||3,100||51.6||(Strength) -Owns sensing and image processing technologies.
(Challenge) -Collaboration & M&As
-From sensing to decision and display
|Environment - Battery and power supply system business||7,000||4,200||66.7||(Strength) -Owns technologies of all types of batteries.
-Owns power supply device technologies
(Challenge) -Meet huge demand without missing any opportunities.
Capital and Business alliance
-The Company announced that it has entered a capital and business alliance with Ficosa International, S.A., a Spanish auto parts supplier. By integrating their unique technologies, the two companies plan to launch an electronic mirror systems business as soon as possible and aim to extend their alliance to the area of Advanced Driver Assistance System (ADAS) in the future. The two companies announced their agreement on the alliance in September 2014. Panasonic completed the acquisition of a 49% share in Ficosa on June 30 2015, after satisfying a number of customary conditions including antitrust approvals. The Company also plans to send four directors to Ficosa. The two companies intend to study the possibilities of further expanding their alliance in the areas of capital, business and technologies. (From an article in the Nikkan Jidosha Shimbun on July 3, 2015)
-GS Yuasa International Ltd. announced that it has signed a basic agreement with the Company to acquire the Company's lead-acid battery business. Under this agreement, GS Yuasa will buy the shares in three Panasonic's subsidiaries in Japan, China, and India, and will purchase the lead-acid battery business from Panasonic's Thai subsidiary. Through this transaction, GS Yuasa intends to increase its focus on the steadily growing Asian market and emerging countries where demand is expected to increase. (From an article in the Nikkan Jidosha Shimbun on October 31, 2015)
-The Company has established a joint venture company to manufacture automotive batteries in Dalian, China. The JV, Panasonic Automotive Energy Dalian Co., Ltd., will supply square-shaped lithium-ion batteries for environmentally-friendly vehicles, including hybrid (HVs) and electric vehicles (EVs), to meet growing demand in China. This is the first time the Company has produced square-shaped lithium-ion batteries outside Japan. The joint venture is capitalized at CNY 273 million (approx. JPY 4.8 billion), with the Company and Dalian Levear Electric Co, Ltd. each investing 50%. Guochen Liu, the Board Chairman of Dalian Levear Electric, will assume the post of chairman and Nobukazu Yamanishi will be the CEO. The JV is scheduled to begin producing lithium-ion batteries for HVs and EVs in 2017. (From an article in the Nikkan Jidosha Shimbun on February 8, 2016)
Promote marketing of vehicle operation management system
-The Company will promote marketing of a business-use vehicle operation management system utilizing a car navigation system. The Company will launch the Driveboss cloud service to centrally control vehicle operation data in January 2016, targeting small companies operating vehicles at multiple sites. A simplified vehicle operation management system using a car navigation system can be introduced at low cost because it does not need a dedicated device. The Company estimates the market size of the business-use vehicle operation management system for small and medium-sized companies to be 1.3 million units. (From an article in the Nikkan Jidosha Shimbun on December 4, 2015)
-German carmakers are increasing the use of lithium ion batteries of Japanese and Korean makers for their electric vehicles (EVs). Volkswagen AG announced that it will shift its focus to the development of electric vehicles and chose Panasonic batteries for its all-new "Golf GTE" plug-in hybrid (PHV). In its medium to long term plan, Volkswagen will expand the EV lineup of the VW and Audi brands based on a common system, which is expected to boost demands for the Panasonic batteries. (From an article in the Nikkan Jidosha Shimbun on November 24, 2015)
-The Company said that its "nanoe" device was selected by Suzuki Motor Corporation for the all-new "Alto Lapin", "Spacia" X grade and "Spacia Custom" XS grade cars. "Nanoe" technology removes odor and suppress bacteria and viruses. By improving efficiency of the discharger and the cooling unit, the Company reduced the device's power consumption by 50% and the weight by 30% compared with those of an existing product. The device, installed in the automatic air conditioning unit, operates in conjunction with the air conditioning unit and discharges "nanoe" particles from the air outlet on the front dashboard. (From an article in the Nikkan Jidosha Shimbun on June 5, 2015)
Outlook for FY ending Mar. 31, 2017
|(IFRS, in million of JPY)|
|FY ending Mar. 31, 2017
|Income before income taxes||300,000|
|Net income attributable to owners of parent||145,000|
|Automotive & Industrial Systems|
-Effective from FY ending Mar. 2017, the Company decided to voluntary adopt IFRS instead of US GAAP . The Company is not showing rate of change because this outlook is made based on IFRS.
>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)
|(in millions of JPY)|
|FY ended Mar. 31, 2016||FY ended Mar. 31, 2015||FY ended Mar. 31, 2014|
|-Automotive & Industrial Systems||189,500||181,200||170,000|
-For FY ending March 2017, R&D Expenditure is planned to be JPY 470,000 million overall.
-In April 2014, the Company established the ADAS Development Center. This center is accelerating R&D by coalescing expertise across the entire Group, including components, devices and image-related technologies. The Company has already developed and won orders for "backward approaching object detection systems" and "emergency braking systems". The Company aims to expand business in the ADAS field while solving social issues through the joint development of new technologies with automobile makers. The Company is suggesting systems to support "driver awareness" and "decision-making" by aligning these products; camera modules, back and corner sensors, and angular rate sensors, steering angle sensors, combined sensors and ECUs.
-Worked to promote growth in major business fields of each segment, focusing its efforts on technology development to contribute to the rapidly developing IoT, robotics technologies, and environmental issues.
-To research and develop infotainment equipments for automobiles, electronic parts such as secondary batteries, and electronic materials.
Intelligent rearview mirroror
-Ficosa International, S.A. anticipates the market with the presentation of an intelligent rearview mirror (IRMS). This system, which has an integrated display in the structure of the interior rearview mirror, works as a mirror or as a monitor that relays images from the camera located at the rear of the vehicle, according to the driver's needs. IRMS is the first product developed as the result of the alliance with Panasonic Corporation. This solution extends the rearward field of vision up to a value of 50° (more than double compared to a traditional mirror). This system also includes a Panasonic LCD screen. Currently, Ficosa is already working with different car manufacturers on the integration of intelligent interior rearview mirror. It is foreseen that vehicles can circulate with this system integrated by the beginning of 2018. (From a press release on March 30, 2016)
Capacitive-type curved touch panels
-The Company will mass-produce capacitive-type curved touch panels for use in displays of car navigation systems and other products in vehicle cockpits. The capacitive-type curved touch panel integrates a plastic cover panel and highly sensitive film sensors, and can enhance the design flexibility of vehicle cockpits. The touch panel also offers ease of use like that of a smartphone. (From an article in the Nikkan Jidosha Shimbun on August 14, 2015)
Freely stretchable plastic film
-The Company, by making use of its proprietary technology on plastic-design technology that leverages the three-dimensional crosslink structure of thermal plastic, which is its particular property, developed a film-like insulating material that can be freely stretched over and over again. In addition, based on using this freely stretchable plastic material, the Company developed transparent electrode material that can maintain conductivity by being stretched over and over; and conductive paste for wiring. The film is very soft and pliable so is suitable for clothing and can fit the contour of any shapes such as the human body, making it possible to make pliable electronic devices. The company has high expectations that this material can be applied to numerous fields such as apparel, displays, and robots.
Head-up display unit
-The Company developed a specially shaped mirror in which navigational information can be displayed on the curved windshields of vehicles, without any distortion, and thereby creating the world’s smallest* head-up display.
*Based on the Company’s own research as of December 9, 2014.
Electromagnetic noise controller/heat-diffuser sheet
The Company developed its own propriety technology on a process for diffusing and condensing that can precisely direct the dispersion of homogeneous magnetic metallic particles with a high degree of accuracy. These particles have been found to be effective in reducing electromagnetic noise. The Company achieved a satisfactory balance between the ability to control high electromagnetic noise, which until now had been difficult; while making the film thinner. Also, the Company developed highly functional conjugation layers that are effective in controlling electromagnetic noise. By applying its technology in joining single-unit electromagnetic noise control film, the Company improved heat-diffusion and noise-control capabilities. As a result, the Company developed the world’s first, thin, single-sheet solution to diffuse heat and control noise at the same time, simplifying the design structure of equipment and improving efficiency.
Thermal sensation estimation algorithm using infrared array sensors
-The Company announced that it has developed a thermal sensation estimation algorithm using Grid-EYE infrared array sensors. The high-precision thermal sensing technology can be applied to products like automotive air conditioning system as a solution for reducing energy consumption and improving thermal comfort. The thermal estimation method was developed jointly with Professor Hiroko Kubo, Faculty of Human Life and Environment, Nara Women's University. The technology recognizes the human sensations of hot and cold by calculating heat loss based on the difference between human surface temperature and ambient temperature, and can help provide optimum temperature for each person. (From an article in the Nikkan Jidosha Shimbun on March 29, 2016)
Polybutylene terephthalate (PBT) molding compounds for laser welding
-The Company announced that it has commercialized polybutylene terephthalate (PBT) molding compounds for laser welding that possess the industry's highest laser transmittance and high weld strength. The compounds will make it possible to reduce processing for components like automotive switches and sensors, and provide enhanced long-term reliability and design flexibility. Full-scale mass production is scheduled to begin in March 2016. (From an article in the Nikkan Jidosha Shimbun on February 24, 2016)
Semiconductor encapsulation material for power devices
-The Company announced that it has commercialized a semiconductor encapsulation material for power devices. The new product with superior heat resistance is expected to improve the performance of power devices that convert and control electric power for industrial and automotive applications. Samples are scheduled to be available this month, and mass production is expected to begin in December 2016. (From an article in the Nikkan Jidosha Shimbun on October 9, 2015)
High-power blue-violet semiconductor laser
-The Company has developed a new high-power blue-violet semiconductor laser. The new laser operates at output power of 4.5 W, which is 1.5 times higher than that of conventional ones even at 60ºC, the maximum operating temperature for lasers in general. This has been made possible by the Company's unique double heat flow packaging technology that improves the heat dissipation. This newly-developed laser features less lasers, leading to a reduction in the system's size and power consumption. (From an article in the Nikkan Jidosha Shimbun on October 6, 2015)
GaN diodes that can operate at low voltages
-The Company announced that it developed gallium nitride (GaN) diodes that can not only operate at a high current that is four times greater than that tolerated by conventional silicon carbide (SiC) diodes, but also operate at low voltages by virtue of their low turn-on voltage. Production of the new diodes was made possible via a newly developed hybrid structure composed of separately embedded structure comprised of a low-voltage unit and a high-current-capable unit, in preparation for high voltage conditions. As a result, use of GaN diodes in the voltage conversion circuits or inverter circuits of automotive or industrial equipment that requires high power can reduce system size due to high frequency operation. (From a press release on September 30, 2015)
|(in millions of JPY)|
|FY ended Mar. 31, 2016||FY ended Mar. 31, 2015||FY ended Mar. 31, 2014|
|-Automotive & Industrial Systems||116,300||107,700||85,400|
-For FY ended March 2016, major investment items of Automotive & Industrial Systems are:
- Expanding production of secondary batteries
- Producing some new on-board vehicle products, infotainment and electronic components, and expanding their production volumes
Planned Capital Investment
|(As of Mar. 31, 2016)|
|Planned investment amount
(in millions of JPY)
|-Automotive & Industrial Systems||185,000||-Expanding production of secondary batteries
-Producing some new on-board vehicle products, infotainment and electronic components, and expanding their production volumes
Investments outside Japan
-The Company will launch a production line for heat-resistant phenolic molding compounds for use in automotive parts at Panasonic Manufacturing Ayutthaya Co., Ltd. (PMFAT), The Company's subsidiary in Thailand. Full-scale operation is scheduled to start in February 2016. The production line will initially have a monthly production capacity of 250 tons. The production of these compounds for automotive use in Thailand represents an industry first (the Company survey). By adding the production line at PMFAT, the Company will meet a growing demand for local production in Southeast Asia. (From an article in the Nikkan Jidosha Shimbun on December 24, 2015)
-The Company has set up a new plant for catalyst-coated diesel particulate filters (DPF) for diesel engines in Suzhou, China. The new plant will start production in December 2015 and supply the parts to engine manufacturers in China. This is the first time for Panasonic Ecology Systems to receive orders for catalyst-coated DPF. The company plans to actively expand its DPF business, and has set a sales target of JPY 10 billion for the fiscal year ending in March 2019. (From an article in the Nikkan Jidosha Shimbun on November 10, 2015)