Panasonic to limit solar panel, battery development: report

According to reports, Panasonic's cost-cutting exercise is slicing deeper into research and development.

Electronics firm Panasonic is considering the imposition of limits on the development of solar panels and small lithium batteries.

panasonic solar panels batteries cost cutting

Reuters reports that production may be curtailed as a means of further company restructuring efforts. In a recent project undertaken by the firm, a solar panel plant was built in Malaysia for 45 billion yen ($564 million), which upped capacity by a third, reaching 900 megawatts. However, because of weak demand, further plans to scale the plant up to 1.5 gigawatts will now potentially be scaled back.

The unnamed sources also said that Panasonic's small lithium battery industry -- the types which are often used in personal computers and devices -- have been hit hard by price competition in Korea and China.

In order to post a profit, the company attempted to shift production to China, but the effort may have not been successful.

Panasonic's energy unit is aiming for sales of over 1 trillion yen, or 10 percent of the firm's overall sales. However, if the suggested cuts go ahead, it is less likely the unit will reach this target.

Recently, reports also suggested that the firm's mobile phone unit will also be a casualty of cost-cutting -- rumors suggesting that Panasonic may be withdrawing from the European market within six months.

Panasonic's new president, Kazuhiro Tsuga, has said that all of the company's low profit or loss-making units will be weeded out as part of the restructuring effort. An official plan will be released by the end of the fiscal year.