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Tesla Supplier Panasonic to Cut Costs to Support Shift Into AI

Feb 04, 2025 - financialpost.com
Panasonic Holdings Corp. is planning to reduce fixed costs by overhauling personnel and trimming underperforming businesses as part of a strategic shift towards more profitable areas like AI data centers. The company, known for its diverse operations including consumer electronics and batteries for Tesla, aims to restructure low-growth segments and adjust its employment structure. CEO Yuki Kusumi mentioned the possibility of changes to the TV business but did not confirm a sale. Panasonic plans to increase profits by over ¥150 billion by March 2027 and another ¥150 billion by March 2029 through consolidating production, sales, and logistics.

The company is focusing on integrating AI technology and collaborating with Anthropic to enhance AI-related revenue. Panasonic, once a leader in consumer electronics, is now a significant battery supplier to Tesla and is expanding into software while maintaining relevance in appliances and industrial devices. The company reported a 4% rise in operating profit in the December quarter, driven by its lifestyle and energy segments. Panasonic has benefited from the US Inflation Reduction Act, which offers tax credits to battery factories, and anticipates continued profit growth due to demand for electronic parts and materials for generative AI.

Key takeaways:

  • Panasonic Holdings Corp. is planning to cut costs by overhauling personnel and trimming underperforming businesses to focus on AI data centers.
  • The company aims to boost its profit by more than ¥150 billion by March 2027 and an additional ¥150 billion by March 2029 through consolidation and restructuring.
  • Panasonic is integrating AI technology across its operations and collaborating with Anthropic to enhance AI-related revenue.
  • The company is a key battery supplier to Tesla and is expanding its presence in software, while maintaining relevance in appliances and industrial devices.
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