Panasonic Consumers Sales Down 2% Profits Down 60%
Panasonic sales of consumer products have fallen 2% due to the weak demand for consumer electronics and appliances, operating profit fell 60% from a year ago.
Meanwhile demand for their entertainment & communication products as well as their tough notebooks, increased due in part to an improvement in procurement of parts & materials that had initially been affected by COVID 19 delays.
As sales of consumer lifestyle goods softened, the Japanese Company who are a dominant player in the EV battery market reported that they have cut their full-year profit outlook at its battery unit by 15 per cent, blaming slower-than-expected sales of high-end electric vehicles at Tesla, one of its most important customers.
The downgrade was a result of slowing demand in North America for Tesla EVs, where resale prices have plummeted, repair costs are significantly higher than other vehicles and consumers who have owned Tesla vehicles longer than Australians are faced with significant costs to replace a battery.
Recently Panasonic cut automotive battery production in Japan — where it produces the batteries for the more expensive Tesla models including the Model S and Model X — by 60 per cent compared with the first quarter as it tried to bring inventories back to normal levels.
The company’s less positive outlook for its battery segment follows similar warnings by several automakers and suppliers, as major economies, including China and Europe, see weaker growth.
Key takeaways from last night’s call were.”
Sales remained stable year-on-year, with increased sales in the Automotive and Connect sectors offsetting decreases in the Lifestyle and Industry sectors.
Adjusted operating profit and net profit increased, primarily due to profit growth in the Automotive and Connect sectors and improvements in financial income and expenses.
The company announced an interim dividend increase.
The company discussed its HVAC business in Europe, identifying an expected recovery in demand due to European policies for greenhouse gas reductions.
The company highlighted challenges and growth opportunities in the Lifestyle, Industry, and Energy sectors.
Shares in Panasonic Holdings fell 1.98% overnight.