Bloomberg News

Panasonic Leads Shift Toward Energy-Saving Bulbs After Quake

October 04, 2011

Oct. 5 (Bloomberg) -- Panasonic Corp. and Sharp Corp., makers of Japan’s most popular appliances and televisions, are accelerating their shift toward energy-saving devices after this year’s earthquake led to nationwide power shortages.

Panasonic showcased its latest solar panels and power backup systems at CEATEC, Japan’s biggest annual electronics show, which kicked off near Tokyo yesterday. Sharp displayed how an electric car could serve as an emergency power source in case of blackouts. Hitachi Ltd. also exhibited energy-efficient products such as light-emitting diode bulbs.

The exhibits, a contrast to the 3-D televisions that took center-stage last year, underscore Japan’s mounting interest in products that consume less electricity after the March 11 disaster triggered the world’s worst nuclear accident in 25 years and caused power shortages. The shift comes at the expense of TVs, an industry where the Japanese manufacturers are falling further behind South Korea’s Samsung Electronics Co. and LG Electronics Inc.

“Presentation of large-screen TVs, which had long been the focus of CEATEC, dramatically decreased,” Mizuho Securities Equity Research analyst Ryosuke Katsura said. “TVs are no longer the focus of electronics makers’ businesses. For energy- saving goods, we can expect to see the government giving subsidies.”

The magnitude-9 earthquake led to power shortages after reactors at the Fukushima Dai-Ichi plant of Tokyo Electric Power Co. melted down. Japan’s Prime Minister Yoshihiko Noda said last month the country still needs atomic power, which provided about 30 percent of the electricity in the world’s third-biggest economy before March 11.

‘Losing Power’

“The March incident made us realize how big the impact is to lose power supply,” Panasonic President Fumio Ohtsubo said in a keynote speech at the convention yesterday. “Expectations for renewable energy sources, especially solar power, has risen in Japan and elsewhere. We plan to facilitate the expansion of those energies to households as well as to large-scale users.”

In August, Japanese lawmakers approved a bill to subsidize electricity from renewable power sources, a measure that Sharp President Mikio Katayama said will likely boost the nation’s solar-panel shipments as much as 10-fold.

“The solar battery is one of our two themes this year,” Katayama told reporters at the exhibition yesterday. “It took center stage at Sharp’s booth. That symbolized the increasing expectation on energy after the March 11 earthquake.”

Bravia TV

Japanese electronics makers, coping with a strong yen that’s appreciated more than any major currency this year, have reason to diversify. Sony Corp., Japan’s largest exporter of consumer electronics, is among TV makers struggling to lure consumers to upgrade their sets, including those featuring 3-D technology.

In July, Tokyo-based Sony cut its annual profit forecast 25 percent after a slump in demand in the U.S. and Europe led the company to lower its estimate for television sales. Sales of Bravia televisions worldwide this year will be 22 million units, compared with an earlier estimate for 27 million units, Sony said then.

Panasonic, Japan’s biggest maker of appliances, said in July interest for houses and equipment that can generate and save energy is rising after the natural disasters. The Osaka- based company is building 1,000 homes in its former factory site in Fujisawa, southwest of Tokyo, a project that the company estimates will likely yield at least 100 billion yen ($1.3 billion) in revenue in the year ending March 2013.

Panasonic Houses

Panasonic may replicate the project at other factory sites it closed, Teruhisa Noro, a director for Panasonic’s systems and equipment business promotion division, said in an interview in July. The home-products unit was the company’s biggest profit generator for the quarter ended June 30. By comparison, the division that makes TVs posted a 16 billion yen loss.

The Fujisawa “smart town” project illustrates corporate interest in gaining expertise to build next-generation cities and win a bigger share in the booming infrastructure market, Panasonic president Ohtsubo said in May.

“There is a huge business opportunity in energy saving,” said Tatsuya Yamada, senior manager of strategic planning at Hitachi. “Because of the earthquake, the balance between electric demand and supply changed.”

Carmakers are also on board. Toyota Motor Corp. is partnering with Toshiba Corp. and Sharp to build a city in Toyota city, Aichi prefecture. Their aim is to reduce emission of green-house gases by using next-generation cars and systems that can utilize power stored in their batteries.

Nissan Motor Co. has a similar plan in Yokohama City, Kanagawa prefecture.

“The role for electric cars changed dramatically since March 11,” Osamu Masuko, President of Mitsubishi Motors Corp. said yesterday. “We need to think of ways to store energy to use it.”

--With assistance from Yuki Yamaguchi, Naoko Fujimura, Yuki Hagiwara and Mike Firn in Tokyo. Editors: Anand Krishnamoorthy, Young-Sam Cho

To contact the reporters on this story: Mariko Yasu in Tokyo at myasu@bloomberg.net; Takashi Amano in Tokyo at tamano6@bloomberg.net; Kazuyo Sawa in Tokyo at ksawa3@bloomberg.net

To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net


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