Matsushita set to retain market leading position

Japanese consumer electronics giant set to finish 2006 as world’s top CE vendor

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By  Published  December 1, 2006

Japan’s Matsushita Electric Industrial, which owns the Panasonic brand, reported a 21% rise in first-half profit last month on the back of strong global demand for its Viera plasma TV range. The company also reported increased sales of its Lumix digital camera range and household appliance product portfolio. According to the latest industry data supplied by DisplaySearch, Panasonic remained number one in the plasma display sector for the ninth consecutive quarter, reaching a record high unit share of 33% and revenue share of 34% on 20% growth. LG Electronics took out second position with a slight edge over Samsung. However, Samsung claimed the number two position on a revenue basis. The results would appear to buck market trends suggesting faltering consumer demand for plasma TVs in the face of cheaper and larger LCD TV models flooding the market. Matsushita executive vice president Tetsuya Kawakami said Panasonic was on track to sell around 3.7 million plasma TVs in the 12 months to March, 2007, revised down from an initial estimation of more than four million. “Compared with the time when the initial four million target was set, the market is now geared more towards larger models,” he said. “The original target is comparable to about 3.7 million under the current circumstances,” he added. Matsushita president Fumio Ohtsubo said the company remained confident that plasma would retain a competitive edge over LCDs in the large screen television market. Ohtsubo said Matsushita was also on track to retain its position as the world’s largest consumer electronics manufacturer, with the company expecting 9% sales growth for the full operating year. “Competition between LCD and plasma in the large flatscreen television market is here to stay,” he said. “But the larger panels become, the more important response speeds for moving images are. In terms of this, plasma still excels.” However, industry pundits have identified a distinct decline in consumer demand for plasma TVs, despite record sales growth over the past 12 months. DisplaySearch found that plasma TV sales growth of 47% in the third quarter of 2006 was significantly less than any other quarter to date, with year-on-year growth over the past 12 quarters ranging from 73% to 170%. DisplaySearch identified a massive 560% increase in demand for LCD TVs in the 40- to 47-inch range year-on-year in the third quarter, while 37-inch LCD TV panel shipments were greater than plasma TV panel shipments for the first time during the quarter. Interestingly, Matsushita actually surrendered the number one position in the plasma TV market to LG Electronics in the third quarter for the second time during the past three quarters. Of the top three vendors, LG Electronics was the only one to increase its share of the market, with unit shipments rising 27% quarter-on-quarter. Still, Matsushita enjoyed greater gains due to its emphasis on more profitable large screen displays.

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