Pioneer to end plasma panel output, source says

• IBTimes RSS
• Print
• E-Mail
• digg
• Del.icio.us

Shares in the maker of audio-visual products and auto electronics jumped to a four-month high after first reports of the move, and were up 11.2 percent at 1,160 yen as of 12:50 a.m. EST.

Pioneer is the world's fifth-biggest plasma TV maker, but it has been struggling to compete with larger rivals with better output efficiency such as Matsushita Electric Industrial Co, maker of Panasonic-brand electronics.

After the move, Pioneer plans to buy plasma panels for flat TVs from Matsushita, the Nikkei business daily reported. Pioneer is already planning to buy liquid crystal display panels from Sharp Corp to start offering LCD TVs.

"This is an excellent development," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management.

"Pioneer could have chosen another way and stepped up its plasma investment despite the fact that the business is bleeding red ink, but it's a wise step to decide against that," he said.

"A quicker decision would have been even better, though."

Pioneer has spent a little over 100 billion yen to build four plasma panel production lines and to buy two more lines from NEC Corp.

Japanese TV makers have been undergoing a realignment as top manufacturers with ample output capacity such as Matsushita and Sharp look for panel buyers, while mid-tier players seek ways to obtain display panels without making hefty initial investments.

A Pioneer spokesman said the company would unveil its display business strategy when it announces companywide business plans on Friday.

• 1
• 2