From Electronic Appliances to Electric Cars: Why Do Global Electronics Giants Make Foray into Electric Car Market? | BusinessKorea

Friday, January 19, 2018

From Electronic Appliances to Electric Cars

Why Do Global Electronics Giants Make Foray into Electric Car Market?

Following Dyson and Yamada, Panasonic will make a foray into electric vehicle market.
Following Dyson and Yamada, Panasonic will make a foray into electric vehicle market.
Seoul, Korea
1 December 2017 - 12:45pm
Michael Herh

Panasonic will make a foray into electric vehicle market after Dyson, and Yamada. With electronics makers entering the electric car market, industry experts are turning their eyes to Korean electronics giants such as Samsung Electronics and LG Electronics.

According to the Nihon Keizai Shimbun Newspaper of Japan on November 30, Panasonic proposed supporting electric vehicle production in anonymous local companies in China and India. Panasonic was reported to throw its hat into the ring of the electric car business in a way that supports local companies such as lithium-ion batteries and motors and even design and production starting next year.

In addition to batteries and motors, Panasonic sells a variety of electric vehicle parts including electronic control units (ECUs) and cockpit equipment while manufacturing experimental electric vehicles. The company was planning to increase sales of electric car parts in connection with local companies and accumulate business know-how such as services related to design and production, foreign news media reported.

Kazuhiro Tsuga, president of Panasonic, said in a recent interview with local media, suggested a possibility that the company will enter production of electric cars, saying, “We may produce electric cars in an OEM (Original Equipment Manufacturer) production system.”

It was also reported that Panasonic was also seeking opportunities for an electric car sharing service.

Earlier, in September, UK consumer electronics company Dyson said it would invest £ 2 billion in production of electric cars and launch its first electric car in 2020. In November, Yamada Electric of Japan also announced that it would produce and sell a low-priced electric car worth about 10 million won (US$9,000) in 2020.

The electric car industry expects that the electronics industry will continue to move into the electric car market, and is paying attention to Korean electronics companies such as Samsung Electronics and LG Electronics. Though both companies have said they will not enter the finished car market, they have the capability to manufacture a variety of electric parts, such as batteries and infotainment systems like Panasonic.

However, it is a dominant view that the two companies are unlikely to enter the finished car market right away. "Although Panasonic has a few major customers besides Tesla, Samsung and LG have already made considerable business ties with major automakers, so they will not risk entering the automobile market and giving up the market of parts," an industry representative said.

Meanwhile, Harman in charge of the electronic device business at Samsung Electronics, posted 2.09 trillion won (US$1.88 billion) in sales in the third quarter and LG Electronics' VC Business Division 870 billion won (US$783 million) in sales.

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