For the year Panasonic has lost 44 % of profit for Tesla and trade wars
Panasonic Corporation has reported a sharper than expected fall in operating profit in the first quarter of its accounting year: 56,39 billion yen ($519,68 million) against of 99.96 billion yen a year earlier. A sharp decline of 44%, the Japanese company explains the trade tensions between China and the U.S. dampened demand for its automotive components and factory equipment in China.
A miscalculation in expectations made founded last year by research company in the field of global Finance Refinitiv, predicted the decline in profits to 70,93 billion yen, citing the calculations of eight analysts. But despite this substantial decline, Panasonic left unchanged its forecast for net profit for the current fiscal year ending in March 2020, at the level of 300 billion yen. Meanwhile, the average estimate of 20 analysts points to 320 billion yen.
Directions Panasonic for manufacturing automotive components and production equipment, which was stated as the main sources of profit growth after the withdrawal from low-profitable business of consumer electronics, remains weak: the investment costs are rising as demand in China slows.
Panasonic is the exclusive supplier of batteries for Tesla. Delay sedans for the mass market Model 3 slowed the return of investment by Panasonic in the production of batteries in a joint venture Gigafactory. Tesla’s shares dropped last week after the electric car pushed back the release date on profitable operations, reported lower margins, and announced the departure of their technological Director.
Stock quotes Panasonic has fallen by half since the end of 2017 due to concerns about the lack of sources of growth, and high dependence on the success of the Tesla. Now Panasonic is cautious about further expenditure on the expansion of production Tesla and plans to create a new joint venture to produce batteries with Toyota Motor Corporation.