Matsushita Reorganizes European Car Audio Business; Closure of Panasonic Automotive Systems Deutschland

Business Wire, Oct 28, 2003

Business Editors

OSAKA, Japan--(BUSINESS WIRE)--Oct. 28, 2003

Matsushita Electric Industrial Co., Ltd. (NYSE: MC) today announced plans to reorganize its European car audio business operations. This move is part of the company's efforts to become a top supplier of car electronics equipment in Europe. As part of this reorganization, Matsushita will establish a new R&D/sales company, Panasonic Automotive Systems Europe GmbH (PASE) headquartered in Munich, Germany on April 1, 2004, as a subsidiary of Matsushita Electric Europe (HQ) Ltd. The new company will be established by merging the R&D division of Panasonic Automotive Systems Deutschland GmbH (PASD) located in Neumuenster, Germany, with the car electronics sales division of Panasonic Industrial Europe GmbH, based in Munich. In connection with these shifts, Matsushita will discontinue operations at PASD, an R&D and manufacturing subsidiary, on March 31, 2004. Meanwhile, manufacturing of car audio products at PASD will be transferred to Matsushita's existing production site, Panasonic Mobile & Automotive Systems Czech s.r.o. in Pardubice, Czech Republic.

The reorganization of the above-mentioned European car electronics business reflects Matsushita's strategy to increase its focus on the European automotive industry, which accounts for approximately 30%(*) of global automobile production.

(*)internal estimate based on data released by automobile manufacturers

Upon the implementation of Matsushita's Groupwide business and organizational restructuring in January 2003, Panasonic Automotive Systems Company (PAS), headquartered in Shinagawa, Japan, was established to create an optimum integrated operational structure in the car electronics field, for R&D, manufacturing and sales.

PAS has concentrated its efforts on enhancing a consistent, customer-oriented approach in each of the four regions of North America, Europe, China and Japan, in response to the global expansion of automobile manufacturers. Such efforts include the establishment of a newly reorganized Panasonic Automotive Systems Company of America in April, 2003.

See attached for information about PASD and PASE.

Matsushita Electric Industrial Co., Ltd., best known for its "Panasonic" brand products, is one of the world's leading manufacturers of electronic and electric products for consumer, business and industrial use. Matsushita's shares are listed on the Tokyo, Osaka, Nagoya, Fukuoka, Sapporo, New York, Pacific, Euronext Amsterdam, Euronext Paris, Frankfurt and Dusseldorf stock exchanges. For more information, visit the Matsushita web site at the following URL: http://www.panasonic.co.jp/global/

    Basic Information for PASD (as of September 30, 2003)

Company name             Panasonic Automotive Systems Deutschland GmbH

Representative           Shigeru Matsuda, President

Location of head office  Neumunster, Schleswig-Holstein, F.R. Germany

Date of incorporation    June 1, 1985

Principal business       R&D and manufacture of car audio equipment
                         for automakers in Europe

Share capital            26 million Euros

Financial closing date   March 31

Number of employees      526

Shareholders' equity     62 million Euros

Shareholders
(% ownership)            Matsushita Electric Industrial Co., Ltd.
                         (100%)

Principal customers      Volkswagen AG, AUDI AG, DaimlerChrysler AG,
                         Toyota Motor Manufacturing (UK) Ltd., Honda
                         Export (U.K.) Ltd.

    Financial Results for the Most Recent Three Fiscal Years

    (millions of Euros)


                    Fiscal year ended:        March    March    March
                                              2001     2002     2003

Sales                                         209      229      217

Recurring profit (loss)                        (8)       0        1

Net income (loss)                              (8)       0        1


(Note) Amounts less than 1 million Euros have been omitted.

    This matter will have no material effect on Matsushita's
consolidated, or parent-alone financial position or performance.



    Basic Information for PASE (as of April 1, 2004)

Company name             Panasonic Automotive Systems Europe GmbH

Representative           To be decided

Location of head office  Munchen-Haar, Bayern, F.R. Germany

Date of incorporation    April 1, 2004

Principal business       R&D and sales of multimedia products and
                         systems for automobiles; Sales of automobile
                         equipment and systems related to the
                         environment, energy conservation and safety

Share capital            5 million Euros

Number of employees      approximately 220