Panasonic Rides Demand for Home Appliances, Car Batteries to Post a 27-Time Surge in Q1 Profits

Panasonic now largely focusses on electric car batteries, industrial-use components, and production machinery.

By Reuters | Updated: 29 July 2021 17:48 IST

Panasonic Rides Demand for Home Appliances, Car Batteries to Post a 27-Time Surge in Q1 Profits

Panasonic's home appliances including air conditioners and TVs have sold well this year

Highlights

Panasonic is a key supplier of batteries to Tesla
Tesla this month posted record vehicle deliveries for the second quarter
Panasonic has moved away from low-margin consumer electronics

Panasonic said first-quarter operating profit surged more than 27 times, handily beating expectations as demand for home appliances and automotive batteries recovered from a particularly weak COVID-hit year.

Profit for April-June rose to JPY 104.4 billion (roughly Rs. 7,060 crores) from JPY 3.8 billion (roughly Rs. 260 crores) a year earlier, some 50 percent higher than market expectations and its strongest performance for a first quarter since 2008.

Panasonic, a key supplier of batteries to Tesla, has moved away from low-margin consumer electronics, and now focuses on electric car batteries, industrial-use components and production machinery.

That said, its home appliances including air conditioners and TVs have sold well this year as people spend more time at home during the pandemic.

The automotive business swung to a profit of JPY 9.8 billion (roughly Rs. 660 crores), benefiting from growing demand for electric car batteries through its decade-old, sometimes testy, partnership with Tesla. That compares with a loss of JPY 9.5 billion (roughly Rs. 640 crores) in the same period a year earlier when it was forced to suspend production at its joint venture with Tesla in Nevada.

Panasonic is launching a test line in Japan to make Tesla's so-called 4680 battery cells, which the automaker claims will halve battery costs and help it ramp up battery production 100-fold by 2030.

It is adding a new production line at the Nevada factory and is looking to build a lithium-ion battery business in Europe that would supply car makers there. The Japanese firm also has a battery partnership with Toyota Motor.

Tesla this month posted record vehicle deliveries for the second quarter, weathering a global chip crunch better than rivals, and on Monday it posted market-beating quarterly earnings.

Panasonic reaffirmed its full-year forecast of an annual profit of JPY 330 billion (roughly Rs. 22,310 crores), slightly lower than analysts' forecasts.

The recently-concluded first season of Loki is our focus this week on Orbital, the Gadgets 360 podcast. Orbital is available on Apple Podcasts, Google Podcasts, Spotify, Amazon Music and wherever you get your podcasts.

Affiliate links may be automatically generated - see our ethics statement for details.

Comments

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.