Pioneer will stop making 42-inch plasma panels and instead buy panels in that size and smaller from Panasonic or Hitachi to turn around its loss-making flat TV business, the Asahi newspaper said. Japanese consumer and auto electronics maker Pioneer will end output of such panels at a plant in Kagoshima prefecture in southern Japan as early as by March 2009, the paper said in the report on Saturday.

It will focus on making panels 50 inches or larger at other plants, the Asahi said.

It would be Pioneer's latest step away from a vertically integrated business model, in which manufacturers conduct production of key parts as well as assembly of finished products, after its decision last year to buy liquid crystal display panels from Sharp to start offering LCD TVs.

Pioneer's plasma business has been struggling to compete with larger rivals with better production efficiency such as Matsushita and LG Electronics.