Panasonic retrenchment, I am affected!!

I received a call from my uncle in the second day of Chinese New Year and he asked me about the close down of a plant of Panasonic in Malacca and the shifting of a plant in Sg Way to Shah Alam. He concerned whether I am affected.

It really turn myself into bad mood in a festive like this. To be honest, the closure of Malacca plant ans the shift of Sg Way plant is not a news to the employee in Panasonic. The plant in Malacca (PEDMA Malacca) together with PEDMA Sg Way and PEDMA Shah Alam is consider under a same business unit (In fact, one business unit consists of several small business units). Panasonic at least has 25 plants in Malaysia, including sales office and Cyberjaya Design Center. However, thy are no relation with my factory as all business unit is consider a stand alone business and it will take care of the profit and loss of its own. For example, the Shah Alam factory that manufacture TV set , PAVC Shah Alam has no relation with PEDMA. So, we must understand that the failure of PEDMA Malacca to sustain its business does not affect PAVC Shah Alam.

Until now, which is two months after all the staffs in PEDMA know the Malacca plant is close down permanently, Panasonic finally declare to the public, they are close down one plant and move another pant in Sg way to Shah Alam to become 2 in 1. The workers in PEDMA Malacca is retrenched. They are not allowed to transfer to their sister factory. Of course, compensation is paid. They are being paid for compensation but if your service duration is below 5 years, you are likely only being paid a 3 months salaries. If your service year is over 5 years, you may get a one month to 1.6 months compensation rate. Prior this, PEDMA already has a huge VSS in 2006. In Sg Way Plant alone, they move their Remote Control production to Singapore and China. Tuner production was shift to Thailand, China (Beijing) and Vietnam. However, both China Beijing and Thailand plants both will be close down in this year. Only Vietnam is remaining in the near future. Moreover, Sg way plant and Shah Alam plant will be merged, that means there will be more workers to lose their job in this year as this is an exercise to slim down the business.

We all know in current economic situation, it is not easy to get a profit. That make most of the people think the employer, Panasonic has a good reasoning to close down the non profitable plant. The labour cost is not competitive enough. The truth is that Panasonic in Japan has a strategic plan to shut down most of the asia factories and make Vietnam plant in Hanoi their manufacturing hub in asia. This economic crisis is just an excuse that they use to accelerate their plan. Panasonic in Japan will try to not retrench their workers in Japan even they are paid 3 to 5 times paid of the similar position in Malaysia. This is their companies, not ours. SO they can shift their investment out if they found Malaysia is not competitive enough. They will not withdraw all the investment because they still need backup for Vietnam plant and the Vietnam plant is only 3 years old. They still need the support form Malaysia, China, Japan or Singapore. I can foresee more factories in this countries (except China that still have a strong domestic market) will be close down especially Malaysia that do not have an edge in labour intensive (sure can not compete with Vietnam) as well as in research and development (they do not need two R&D center when Singapore is beside us). The biggest employer in Malaysia will at least cut their 50% workforce from executive to low cost labour before 2012. PICM in Mid Valley may not affected as they are concentrate in marketing.

The only thing I can do is changing my career path. I will start my MBA soon. It may be a good chance to rethink my life and do what I really want to do. When you work in factory, your job scope may be technically too specific, and you can only sell your soft skills. Furthermore, Panasonic is not the kind of company that will send you to professional course or skill training that others companies will do. They will only train you in Panasonic way!!

For those who affected like me or in the factory like me, we may need to enhance our skills beside engineering skills. There is no way the factories has a bright future except FMCG. But we responsible to save ourselves and no one else will help us.