Panasonic battery line China-bound

Kyodo, JIJI

Panasonic Corp. is planning to close its Kaizuka plant in Osaka Prefecture within fiscal 2012 and shift its lithium-ion battery production to Suzhou, China, sources said Wednesday.

The move is aimed at gaining access to low-cost labor in China and cutting production costs to compete with South Korean manufacturers that have been increasing their presence on the back of favorable exchange rates for the won.

The company has already conveyed to the labor union its intent to maintain employment of some 350 workers at the Kaizuka plant by transferring them to other plants within Japan, they said.

While Panasonic currently manufactures most of its lithium-ion batteries for mobile phones and personal computers within Japan, it aims to raise the ratio of Chinese production to 50 percent by 2015, the sources said.

The Kaizuka plant produces lithium-ion batteries used mainly in notebook personal computers. It is one of the production bases affiliated with Sanyo Electric Co., which became a wholly owned unit of Panasonic last year.

The move being considered is part of Panasonic’s initiative to shift battery production to China. Panasonic currently produces nearly 90 percent of its lithium-ion batteries in Japan, but it said last year it plans to increase the proportion of production in China to 50 percent by fiscal 2015.