Panasonic is quitting the solar panel business.
The company was formerly a leader in the market but has now succumb to cheap competition out of China, according to Nikkei Asia.
The company plans on halting manufacturing as soon as March 2022 at its factories in Malaysia and Japan. It'll be a "complete exit from the solar manufacturing business", the report says. Panasonic will stay in the power industry by procuring panels from other manufacturers.
New solar generation this year is expected to rise 10% from the previous year, to 117 million kilowatts. Prices of panels have fallen to about 33% of what they were 10 years ago thanks to increased Chinese production. This increase has put pressure on legacy players, like Panasonic.
Most of Panasonic's sales have been based on domestic demand, but that demand is not expected to grow due to government subsidies in Japan being rolled back.
Panasonic had previously acquired Sanyo Electric and was building on its solar cell business after making it a subsidiary. Panasonic "had its sights set on becoming a top-three manufacturer, but is now out of the top five due to price wars with Chinese companies," Nikkei wrote.
Despite leaving solar, Panasonic will stay in renewable energy, focusing on projects like power management for smart cities.
With its exit from the industry, Kyocera and Sharp remain the two key solar panel manufacturers in Japan.
Recall, Panasonic also shares Tesla's solar panel factory in Buffalo, NY but ended its partnership with the auto company last year. There have been no details on how any shutdown can, and will, further affect Tesla, but we will continue to monitor the situation closely.