Panasonic, Toshiba to close factories in Asia

Japan - The economic storm is taking a toll on two Japanese electronic giants: Panasonic Corporation and Toshiba, both of which are reported to be closing factories in Asia to ease their individual financial situation.

The Nikkei said Panasonic, which enjoyed brisk sales of plasma televisions, mobile telephones and digital cameras in recent years will close two of its three electronics parts facilities in Malaysia and another in the Philippines.

In Malaysia, the operation in Malacca, making film capacitors used in mobile phones is expected to cease operations in March, while the facility in Selangor making switches for audiovisual equipment will be closed in September this year, the Nikkei said.

In the Philippines, the affected plant produces 12 million manganese dry-cell batteries yearly for the local market.

According to the Nikkei, Panasonic spokesman Kunio Ichikawa has declined comment, saying the company will announce its quarterly results on 4 February, which may or may not include a revision to its earnings outlook.

The closure of these factories is expected to affect hundreds of jobs.

The Asahi daily said Toshiba also plans to shutter some assembly plants due to its struggling semiconductor operation.

The plants affected are for system and discrete chips in Japan.

Toshiba are expected to maintain current operations by expanding output in Thailand and Malaysia and from outside suppliers, the daily said.

Toshiba spokeswoman Hiroko Mochida said the company is looking into moving more assembly overseas and other ways to improve efficiency, but nothing concrete had been decided.

An executive at Toshiba said in December that it was considering allocating system chip assembly operations to overseas plants to ride out the downturn, and it would need to review its weak LCD driver and micro-controller operations.