Pioneer, in red, says giving up on plasmas

20 hours ago

TOKYO (AFP) — Japanese electronics maker Pioneer Corp. said Friday it was giving up on its unprofitable plasma panel business as it forecast another year in the red.

Plasma television sales have been falling behind those for liquid crystal displays (LCD), a rival high-definition technology.

"We have judged that maintaining the cost competitiveness of plasma display panels at projected sales volumes will be difficult going forward," a Pioneer statement said.

Pioneer said it would continue to sell plasma televisions but would procure the panels externally. It said it was currently in talks with a supplier and declined further detail.

But Japanese media said that Pioneer would buy panels from Matsushita Electrical Industrial Co., which is best known for the Panasonic brand and is the world's top plasma maker.

Pioneer said it would not see the benefits of streamlining operations in home electronics until the 2010 fiscal year and gave up hope of returning to the black this year.

Citing restructuring costs, Pioneer said the company now expected a net loss of 15 billion yen (148 million dollars) in the year to March 31, compared with a previous forecast of a six billion yen net profit.

It would be Pioneer's fourth straight year reporting a net loss, with the figure more than twice as severe as the 6.76 billion-yen loss posted in the financial year to March 2007.

Pioneer did not change its revenue and operating profit forecasts.

The company plans to put more focus on its signature business of car audio equipment as well as expand in other segments including Blu-ray next-generation DVDs.

The decision marks the latest restructuring in Japan's high-definition television business.

Pioneer, which produces plasma panels at three factories in Japan, also slashed its sales projection for plasma TV sets to 480,000 units for the current fiscal year ending this month from the initial target of 720,000 sets.

Pioneer currently has an eight percent share of the plasma television market, behind Matsushita which is closely followed by South Korea's LG Electronics and Samsung Electronics.

Besides Matsushita, the only Japanese firm left producing plasma is Hitachi Ltd.