Victor Co. of Japan, parent of JVC America, confirmed it will stop making LCD TVs in Japan and Scotland and shift production to other sources in a bid to raise profitability.
Contrary to earlier reports, JVC said it will not drop TV sales in Japan, altogether, but will no longer sell mass-market LCD TV models to focus on higher-profit 42-inch and larger SKUs, published reports here said.
JVC said casting off the money-losing TV assembly operations should help it break even in fiscal 2009, and that it will stop making LCD TVs at its plant in Yokosuka, Kanagawa Prefecture, as early as this summer. All production will be moved to its plant in Thailand.
In a statement the company also announced plans to end production at its U.K. factory in East Kilbride, Scotland, and will instead outsource the work to consignment production by an electronic manufacturing service (EMS) company in Poland at the end of July.
In its report for its fiscal year that ended March 31, JVC said LCD TV shipments for the current fiscal year to March 2009 should reach 35,000 units, down from about 300,000 units in the previous year.
“Japan domestic sales in the consumer electronics segment declined year-on-year, as not only the home storage business including DVD recorders contracted, but also mainstay camcorders, LCD televisions and audio products all fought uphill battles due to heightened market competition,” JVC said. “In the Americas, on a local currency basis, A/V accessories such as headphones registered substantial growth on strong sales, and sales of LCD televisions were firm. However, a contracting market for CRT televisions and lower sales of D-ILA rear-projection televisions led to an overall decline in this region.”
JVC said its group net loss for fiscal 2007 rose to $455 million from last year’s $75 million, due mainly to costs from closing unprofitable operations. It suffered a net loss for the fourth straight year.
Sales were down 11.3 percent to $6.3 billion yen.
JVC reported an operating profit of $31 million following a loss of $54 million.