[Company analysis] Pioneer Corporation(パイオニア)

「Pioneer Corporation(パイオニア)」handles in-vehicle electronic devices such as navigation and AV for vehicles. Previously, it was a leading audio equipment manufacturer in Japan, which also handled home audio. However, due to deterioration in business performance caused by changes in the market environment, the company became a subsidiary of the Hong Kong Investment Fund as of March 2019 and was delisted from Nikkei 225. The number of consolidated employees is approximately 16,798.

 

1. Company Profile

2. Summary and Features

3. Major Business

 

 

 

1. Company Profile

 

※Unit is JPY million, as of 2019

Company name	Pioneer Corporation
Company name (Japanese)	パイオニア
Date of establishment	January 1, 1938
Headquarters location	〒113-0021 東京都文京区本駒込2-28-8 文京グリーンコート

 

 

 

 

2. Summary and Features

 
This company was founded in 1937, by Matsumoto Nozomi(松本望), to domestically produce dynamic speakers. The current company name of「Pioneer」was a trademark of "A-8", the first dynamic speaker in Japan. After the establishment, Matsumoto launched a printing company, which is now in charge of printing Pioneer's manuals and catalogs. In 1961, the world's first separate stereo was released, and as the company name was, it was a pioneer in the speaker field.

In November 1975, they released the world's first vehicle stereo by leveraging their strengths in audio parts. After that,「Pioneer」developed the world's first navigation system equipped with GPS. As for the business scale, it is obviously smaller than「Hitachi, Ltd.(日立製作所)」,「Sony Corporation(ソニー)」,「Panasonic Corporation(パナソニック)」,「Mitsubishi Electric Corporation(三菱電機)」but they took a selective and focused strategy in their own area. Based on this strategy, this company built a superior brand image on electronic devices for vehicles.

However, after the collapse of the bubble economy in Japan,「Pioneer」experienced a sharp decline in sales, as in other industries. Then, in the AV device, the trend was shifted to digital device such as smartphone instead of analog device. so eventually, they decided to withdraw from the AV business in 2014. At the time, all the home AV business including home audio, was transferred to its a subsidiary as of March 2015.

Instead, they concentrated their management resources on the plasma TV business from the latter half of the 1990s. In December 1997, the world's first commercial 50-inch wide plasma TV was released, and the panel was produced in-house. In addition, they even purchased plasma display division from「NEC」. Based on the 2006 standard, both the home appliances business and the automotive electronics business alone accounted for 90% of total sales, and the performance was very good at that moment. The problem was,「Pioneer」used too many resources on plasma TV business and forfeit the business diversification.

In the mid-2000s, due to the decrease in price of LCD TV, they were overruned by competitor, 「Panasonic」in market share. As a product, plasma TV lost their competativeness compare with LCD TVs, and it results a sharp decline in sales of the Pioneer's home appliances business. Eventually, in March 2018, 「Pioneer」announced that they will  suspend production of plasma panels in-house.

In addition, navigation business, other core business of 「Pioneer」, experienced a sharp decline in sales too, due to the spread of smartphones and tablets. The drop of sales was too critical, even it is lower than R&D expenses. As a result of this deterioration in performance, this company was delisted from Nikkei 225 as of March 2019 and became a wholly owned subsidiary of Hong Kong Investment Fund.

 

 

 

3. Major Business

 

■ Automotive electronic equipment business
They manufacture in-vehicle electronic products such as navigation, AV for vehicles, car speakers, and drive recorders.

■ Other business
They are expanding our speaker equipment business, medical / health equipment business, bicycle business, etc. by utilizing our technological capabilities and know-how related to optics, sound, and video.