Toshiba, Panasonic cease manufacturing in Indonesia

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Panasonic Pasuruan
Panasonic’s lighting factory in Pasuruan, East Java

Japanese electronics companies Toshiba and Panasonic ended their manufacturing operations in Indonesia, selling three plants in total in the process which is estimated to result in 2,500 layoffs.

Toshiba has already closed its TV and washing machine manufacturing plant in Cikarang in West Java and sold it to Chinese TV maker Skyworth late last year. The plant was said to have been Toshiba’s largest TV manufacturing plant outside Japan. Meanwhile, Panasonic is in the process of closing its lighting manufacturing plants in Pasuruan in East Java and Bekasi in West Java. Both companies are currently negotiating with their workers about severance payments.

It is understood that Skyworth will continue to produce TVs in Indonesia, but at a smaller scale. The Chinese company together with the plant purchase also received the license to use the Toshiba brand throughout Asia, but excluding China. The transfer is to be completed in March 2016.

The Panasonic lighting factory is also expected to be sold to Chinese industrial investors and production should resume at some scale, according to Indonesian industry representatives.

The closure or at least resizing of the plants is another blow to Indonesia’s manufacturing sector which has been contracting for 16 straight months as domestic and global economic growth remains subdued, while the weaker rupiah rate made imports of raw materials more expensive.

In September last year, Taiwanese electronics contract manufacturer and major supplier of Apple, Foxconn,  said it cancelled plans to build a huge smartphone factory in Indonesia due to land acquisition problems and is considering building it in Malaysia instead. The envisaged $1-billion investment would have created jobs for tens of thousands of workers.

 

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Reading Time: 2 minutes

Panasonic’s lighting factory in Pasuruan, East Java

Japanese electronics companies Toshiba and Panasonic ended their manufacturing operations in Indonesia, selling three plants in total in the process which is estimated to result in 2,500 layoffs.

Reading Time: 2 minutes

Panasonic Pasuruan
Panasonic’s lighting factory in Pasuruan, East Java

Japanese electronics companies Toshiba and Panasonic ended their manufacturing operations in Indonesia, selling three plants in total in the process which is estimated to result in 2,500 layoffs.

Toshiba has already closed its TV and washing machine manufacturing plant in Cikarang in West Java and sold it to Chinese TV maker Skyworth late last year. The plant was said to have been Toshiba’s largest TV manufacturing plant outside Japan. Meanwhile, Panasonic is in the process of closing its lighting manufacturing plants in Pasuruan in East Java and Bekasi in West Java. Both companies are currently negotiating with their workers about severance payments.

It is understood that Skyworth will continue to produce TVs in Indonesia, but at a smaller scale. The Chinese company together with the plant purchase also received the license to use the Toshiba brand throughout Asia, but excluding China. The transfer is to be completed in March 2016.

The Panasonic lighting factory is also expected to be sold to Chinese industrial investors and production should resume at some scale, according to Indonesian industry representatives.

The closure or at least resizing of the plants is another blow to Indonesia’s manufacturing sector which has been contracting for 16 straight months as domestic and global economic growth remains subdued, while the weaker rupiah rate made imports of raw materials more expensive.

In September last year, Taiwanese electronics contract manufacturer and major supplier of Apple, Foxconn,  said it cancelled plans to build a huge smartphone factory in Indonesia due to land acquisition problems and is considering building it in Malaysia instead. The envisaged $1-billion investment would have created jobs for tens of thousands of workers.

 

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