Panasonic's battery unit misses annual profit estimate (updated)

Panasonic Energy India

09/05/2024 08:04

(Updates throughout)
    By Daniel Leussink
       TOKYO, May 9 (Reuters) - 
    The energy unit of Japan's Panasonic Holdings  6752.T 
missed its operating profit guidance for the past business year
due to lower electric-vehicle battery production in Japan and a
fall in sales of consumer products, the company said on
Thursday.
        Operating income for the key segment, which makes
batteries for Tesla  TSLA.O  and other automakers, totalled 88.8
billion yen ($570.18 million) in the year that ended in March,
missing its own 113 billion yen forecast, Panasonic said.
  
        Automotive battery manufacturers have been hit by
slowing growth in EV demand in the United States and Europe and
cut-throat competition in China.
  
        While the North American EV market is growing, its pace
of expansion has slowed due to a saturation of early-adopter
demand, Panasonic said in presentation materials.
  
        The operating profit is expected to rise 23% in the
current business year to reach 109 billion yen, the company
said, adding that it expected demand to expand as more car
models in affordable price ranges become available.    
  
        Panasonic Energy faces fierce competition from other
Asian battery makers such as China's CATL  300750.SZ  and South
Korea's LG Energy Solution  373220.KS .
  
        Chinese battery makers grew faster than rivals to
account for more than two-thirds of global EV battery capacity
last year, according to data from consultancy Counterpoint
Research. 
  
        Panasonic Energy has sought to expand its footprint in
the North American market. It has a plant in Nevada and has
broken ground on a second one in Kansas, which would take its
auto battery capacity to 80 gigawatt hours (GWh) a year.
  
        Panasonic forecast a 5% rise in operating profit for its
entire business for this year to 380 billion yen.
        Its operating profit declined 25% to 40.7 billion yen in
the fourth quarter.
  
        ($1 = 155.7400 yen)

 (Reporting by Daniel Leussink
Editing by Chang-Ran Kim
Editing by Chang-Ran Kim)
 ((daniel.leussink@thomsonreuters.com; Twitter:
@danielleussink;))