The money will be used in it production facilities, particularly in Bang Phli district of Samut Prakan province, and for marketing activities, and the investment will be part of the company's growth strategy in the Kingdom. Panasonic expects to increase its total revenues in Thailand from Bt67 billion in fiscal 2006 to more than 100 billion in the next three years, said Daizo Ito, group CEO in Thailand.

The business expansion in Thailand is also part of Matsushita's new three-year mid-term Leap Ahead 21 plan.

Ito said the group also planned to increase its exports from 67 per cent of total sales now to 78 per cent in the next three years.

Panasonic currently exports finished home appliances, audio-visual products and electronic parts to 25 markets in Asia, South and Central America, Africa and Japan.

"Despite many uncertainties in Thailand, both politically and economically, we are committed to continuing our investment strategy," said Ito.

He said Thailand, together with Vietnam and India, were still attractive countries for investment, due to strong domestic demand.

"Thailand is a country with good  infrastructure, including main roads and the new Suvarnabhumi Airport. The demand for electrical appliances and consumer electronics is also strong among Thai consumers. The local authorities have also granted many privileges, including tax and investment privileges to attract foreign investors," said Ito.

He said Vietnam was another country with a favourable atmosphere for foreign investors. Local demand in Vietnam was growing quite rapidly, because the market was newly opened to foreign investors. The company is considering investing in new facilities in Vietnam for electronic parts and systems. Ito said investment in Vietnam, however, would not affect its facilities in Thailand.

Fumio Ohtsubo, president of Matsushita Electric Industrial, recently revealed the company's Leap Ahead 21 business plan to March 2010 that allowed the company to enter a new phase of growth.

Under the plan, which is also designed to allow the firm to survive global competition, Matsushita has implemented various initiatives since fiscal 2005, including a global procurement strategy to minimise logistics and raw-material costs.

The plan is aimed at achieving an operating profit-to-sales ratio of 5 per cent or more.

"A lean and agile management style is firmly in place," said Ohtsubo. He gave the example that Matsushita had reduced its consolidated total assets by 460 billion yen (Bt137 billion), since the beginning of the Leap Ahead 21 plan by cutting factory inventories with the introduction of Next Cell Production System and accelerating IT innovation. The company also implemented its Cost Busters project to reduce costs by about ¥220 billion over the next three fiscal years.

Ohtsubo said Matsushita had set a global sales target of ¥10 trillion or more for fiscal 2010, with 60 per cent or more from international sales.

Along with the plan, the Panasonic Group in Thailand expects to increase its market share in several items, such as television sets, air-conditioners and refrigerators.

Ito said the group expected to increase its market share of Panasonic plasma television sets from 30 per cent now to 40 per cent and LCD televisions from 10 per cent to 20 per cent by the end of fiscal 2007. The company also expects to boost its share of the refrigerator market from 18 per cent now to 20 per cent and of the air-conditioner market from 21 per cent to 25 per cent.

Ito said Matsushita had also spent ¥280 billion to build its fifth manufacturing facility for plasma display panels in Japan. With the new facility, the company expects to cut its production costs for the panels by as much as half over the next three years.

Kwanchai Rungfapaisarn

The Nation