Panasonic Makes Big Plasma Play

At the Panasonic spring line show last month, the company showed rear projection and direct view LCD models in addition to their new plasma line, but it’s clear that the company is committed to making a big play for plasma. While some other companies — including Philips — are pulling back from plasma displays, Panasonic is moving forward. Parent company Matsushita has budgeted $2.4 billion to build a third manufacturing plant at Amagasaki. The plant is forecast to reach an annual production capacity of 22 million units by 2009.

The goal apparently is to increase productivity, so that manufacturing costs represent a smaller portion of the total price. Panasonic clearly is the leader for consumer plasma televisions, but the question is whether or not they can wring costs out of their products faster than the LCD competition. The LCD plants are creating larger and larger displays, encroaching on territory that once was owned by plasma. And there are a lot of LCD producers, which makes for some hungry competitors.

Panasonic’s investment is a bold move, and ensures that plasma will be part of the HDTV decision matrix for consumers for at least a few more years. And it also probably means that the competitive forces pushing down prices for large screen HDTVs is not going to let up any time soon.