Jakarta. The Industry Ministry confirmed that Panasonic Holdings' global workforce reduction does not impact its operations in Indonesia. The Japanese multinational recently announced plans to cut 10,000 jobs worldwide, with half of the cuts taking place in Japan and the other half in overseas operations. Ministry spokesperson Febri Hendri Antoni Arif assured that Indonesia remains a critical production hub for Panasonic in Southeast Asia.

"The layoffs at Panasonic Holdings have not affected its operations in Indonesia. In fact, the Indonesian factories serve as a key export base, supplying products to over 80 countries, showcasing the strength of Indonesia's electronics industry competitiveness," said Arif in a statement on Monday.

The global job cuts, amounting to approximately 4 percent of Panasonic's 230,000-strong workforce, are part of the company's strategy to become a leaner and more efficient organization. This includes early retirement offers in Japan, as well as closures and consolidations of various global operations.

Febri acknowledged that the utilization rate, which refers to the percentage of an industry’s total production capacity being used, was 50.64 percent in the first quarter of 2025, indicating that more than half of the industry's capacity remained unused. This is lower than the pre-pandemic rate of 75.6 percent.

"Global competition in the electronics sector is becoming increasingly intense. This is a reminder that technological transformation, productivity improvement, and operational efficiency are crucial for survival," he added.

The ministry is focused on boosting the industry's utilization rate through domestic market protection against imported electronic products, preserving existing investments, and attracting new investments.

"Indonesia’s domestic market is one of the largest in the region, and the government fully supports strengthening the industry through the Domestic Component Level (TKDN) policy," he said.

To further improve the sector, the Industry Ministry is implementing several programs aimed at increasing productivity in the electronics industry, including providing incentives, workforce training, and strengthening high-tech manufacturing ecosystems.

"We are optimistic that with the right policies and strong collaboration between industry players and the government, Indonesia's electronics sector will continue to grow and contribute significantly to the national economy," Febri concluded.

Meanwhile, Panasonic reported a 17.5 percent drop in profit for the fiscal year ending March 2025, with a profit of 366 billion yen ($2.5 billion), down from 443 billion yen the previous year. Sales totaled 8.46 trillion yen ($58 billion), a slight decline of 0.5 percent year-on-year. The company attributed the weak results to the slowing global economy and weaker demand for electric vehicles, although air conditioner and consumer electronics sales in Japan remained stable.