The Online Photographer

Panasonic Holdings Co. Ltd., a.k.a. Panasonic HD, formerly Matsushita Electric, the global multinational headquartered in Kadoma, Japan, announced in a meeting on the 17th of this month that it will fail to meet two out of three of the business objectives of a three-year plan ending this year. The main culprit appears to be an unexpected slowdown in demand for the automotive batteries it builds for Tesla. Panasonic HD manufacturers a wide array of consumer and business-to-business products in five main areas: Lifestyle, Automotive, Connect, Industry, and Energy. EV batteries fall into the Energy segment, which also includes digital cameras.

The two areas in which the company will not meet expectations are return on equity and cumulative operating profit. Panasonic Group CEO and President Yuki Kasumi was quoted by Asahi Shimbun, the oldest newspaper in Japan, as calling this a "crisis situation" for the company.

Asahi Shimbun states (this is an auto-translation) that "the company announced that it will take drastic measures to eliminate 'challenging businesses' with poor growth potential by fiscal 2026, with consideration given to business transfers and withdrawals." ("Business transfer," as far as I can tell, is what happened to Olympus's camera and lens division.)

Since enthusiast cameras are well known to be a category with "poor growth potential" at the moment, this has got the photography community understandably upset. It's logical to worry that language like "crisis situation" and "drastic measures" might foretell doom for the Lumix brand. That's possible. Large corporations do not share their internal planning; we never know when major decisions are made, either, and they might not have been made yet. However, Kasumi-san did not specifically mention the camera and lens business as candidates for downsizing or divestiture, suggesting only that "home appliances, televisions, and some air conditioning businesses" were among those "challenging" businesses that offer limited prospects for future growth.

It's worthwhile remembering that cameras are sometimes considered identity businesses for large corporations, as they are highly visible to the public—and also that cameras are not a large part of Panasonic HD's business or profit; the category tends not even to be broken out in Panasonic HD's business reports. So this appears to be a wait-and-see situation more than anything.

Concerning, all the same.

Mike
(Thanks to Kent Phelan)

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Featured Comments from:

Jayanand Govindaraj: "Sony is in the same boat as Panasonic—its camera division is not even in its Professional Imaging Division, but in the Consumer Electronics Division, of which it is an insignificant part. They do not even need the brand recognition via cameras; they have enough and more consumer products that do that for them, spearheaded by PlayStation. I always thought that Panasonic and Sony would be the first to get out of the still camera business when things get tough—it is really an absolutely peripheral business for both the behemoths. They will absolutely remain in professional video capture, though."

Mike replies: FWIW, the old (up-to-1990s) Kodak made the same distinctions—professional vs. consumer. There was such a hard boundary between the two that we had trouble getting ads from them, because we were unwilling to say anything but the truth, which was that both pros and hobbyists subscribed to our magazine. Ads for the two were handled by completely different pipelines.

Richard Reilly (partial comment): "When I lived in Japan (more than a decade ago) I bought a couple camcorders which I was happy with...originally. One of them failed after I'd left the country, and I was unable to obtain the necessary part to fix it, a part that had a high failure rate and was not made available by Panasonic outside Japan. I'd also purchased a camera (along with three lenses) while living there, a camera which was problematic from the start. The retailer refused to take the camera back (in violation of Japanese consumer protection laws, which I didn't learn until after I'd sold it at a considerable loss), and Panasonic flat-out refused to help me with a new product that was obviously under warranty. Needless to say, I've avoided Panasonic products ever since.

"It was always interesting to me that my Japanese friends, every one of them, refused to buy products from two companies with worldwide success: Sony and Panasonic."

Kirk: "My prediction? In the near future it will be Nikon, Canon and Leica selling us cameras. Sony will do the math the same way Samsung did all the way back in 2014 and exit the market along with Panasonic. The systems with the best color science, the richest histories of making great and useful products, and those occupying the most defined niches will be the survivors. Canon and Nikon because they work well, feel good, and make great files. Leica because there always needs to be an aspirational top of the market."

Mark Sampson: "Those of us who shoot film and make actual photographic prints have become used to gear, and materials, disappearing from the market. A look at a couple of issues of your old magazine from thirty years back (I recently found a few) will quickly remind you of what we have lost. It's alarming that this may also become true of digital photography...let's hope that major manufacturers like Panasonic and Sony don't look at their balance sheets, say 'why bother?' and give photography up."