Panasonic is considering scaling down its semiconductor production business in line with its recent decision to cut television output, the Nikkei business daily said on Sunday citing company sources.

The company plans to cut jobs in the chip-making operation through an early retirement program, but the size of the job cut has not yet been decided, the paper said.

In Japan, Panasonic currently makes semiconductors at five plants. The company plans to increase semiconductor purchases from other companies, the report added.

Media in Japan on Thursday also reported that Panasonic would reduce plasma TV panel production and lay off about 1,000 people, as the company's loss-making television unit struggles to compete with like Samsung and LG.