Falling yen drives Panasonic back to Japan: report   

日元貶值沖擊波：松下欲將中國家電生產基地撤回日本

(ECNS) - Panasonic plans to move its appliance production bases from China back to Japan due to a weakening yen, the National Business Daily reported on Wednesday.

The Japanese corporation has been transferring its appliance production bases abroad since 1990. Nearly 70 percent of Panasonic's household appliances are produced outside Japan.

But Japan's currency had devalued to 120 yen against one dollar by the end of 2014.

The declining value makes China-made exports of appliances to Japan more costly, resulting in weakened competitiveness.

Another reason for the pull-out is the increase in labor costs brought about by China's gradual loss of demographic dividends, analysts say.

Panasonic's three production bases in China are located in Hangzhou, Guangzhou and Shanghai, and mainly manufacture washing machines, air-conditioners and microwave ovens. The annual production capacities of these three bases are 3.6 million, 4 million, and 4 million, respectively.

The bases in China will be moved to Panasonic's factories in Fukuroi, Kusatsu and Kobe.

Panasonic's decreased market share in China is also a reason for the move, says Wu Xianjian, secretary general of the National Consumer Electronics Distributor Alliance.

Panasonic's sales from April to September of 2014 amounted to 3.72 trillion yen ($31.31 billion), the same as that of 2013. But the net margin of the period in 2014 was 80.9 billion yen, only 48% of the figure in 2013, according to data from Panasonic.