Matsushita Electric Industrial Co. said on Tuesday that global demand for plasma televisions and the profitability of the firm's plasma business were running above target.
Panasonic brand products maker Matsushita is the world's top seller of plasma
TVs, ahead of Samsung SDI Co. and LG Electronics Inc. of South Korea and
Japan's Pioneer Corp. in the fast-growing market.
Masaaki Fujita, head of Matsushita's plasma TV business expects the global
market reach 6.0 million units in the year to March, one million above its
prior forecast and more than double the 2.7 million units sold in 2004/05.
Fujita expressed confidence that Matsushita would be able to secure 35 percent
of the global market. Based on the new forecast, Matsushita would sell 2.1
million plasma TVs in 2005/06, above its previous forecast of 1.75 million
Plasma is one of three technologies vying for share in the flat TV market. The
other two are liquid crystal displays (LCD), which are primarily used for TVs
under 40 inches, and rear-projection technology, best suited for TVs above 50
Matsushita also makes LCD TVs but says plasma is the best technology for flat
sets above 37 inches because they can be produced more cheaply at the larger
sizes and offer better image quality on several measures including a wider
viewing angle, better reproduction of moving pictures, and a deeper black.
It faces a growing threat from Sharp Corp., which has recently introduced a
series of LCD sets of 37 inches and above that are selling well, but so far
Matsushita's strategy seems to be paying off.
Citing industry data, Fujita said Matsushita had 44 percent of the U.S. plasma
TV market in June, helped by the introduction of new high-definition models. It
has captured about 70 percent of the Japanese market, he said.
Fujita said profits in the plasma business, one of its key earnings drivers,
were above its internal projections in April-June, although he did not give
The bullish comments contrast with LG Electronics, which on Monday said its
display business lost money in the latest quarter and Pioneer, whose plasma
business has been mired in the red amid sluggish sales and low production
Fujita said its production yields were above 90 percent and that it was more
efficient than its rivals because it had achieved a vertically integrated
business model, meaning it produces semiconductors and other key components
Matsushita plans to start operations at a new plasma display panel factory in
September in Hyogo prefecture, western Japan.
The plant will have an initial output of 1.5 million panels per year, a
calculation based on 42-inch panels. Output will be ramped up to 3 million
units per year in late 2006, boosting the company's total output to 4.8 million
Between 85 and 90 percent of Matsushita's plasma panels are used in its own TV
sets but the company hopes to use the new factory's output to raise the
proportion of panels it sells to other companies over the medium-term, Fujita