In a first for Japanese electronics giant Panasonic, the company has moved the global headquarters for its refrigeration compressor business to Singapore.
Minister for Manpower Lim Swee Say announced the company's first such relocation outside of Japan in recent decades yesterday at the official opening of Panasonic's refrigeration compressor business unit (RCBU) in Singapore.
The manufacturing plant here, which makes refrigeration compressors, will also be transformed from a traditional manufacturing plant into a "smart factory", which will make use of big data and make processes more automated.
Although workers could be worried about being replaced by robots, Mr Lim said Panasonic "shows us that while technology may replace some jobs, it can also create new and better ones".
Even as Panasonic's operation has become more manpower lean, it did not retrench local workers, but instead retrained them to work alongside robots, noted Mr Lim.
Retraining benefits workers, he said, adding that Panasonic's retraining of its local staff has resulted in a 35 per cent jump in the median salary over the last five years.
However, Mr Lim said companies may still need specific expertise which they cannot find in Singapore. In the case of Panasonic, they had to hire foreign workers with skills in advanced element design and process innovation.
Citing "the complementarity of our local and foreign manpower", Mr Lim said the foreign experts "helped to train and strengthen our locals to master these skills", improving the local workforce.
At a press conference yesterday, the company's top management pledged to keep the jobs of its 650-strong Singapore workforce, even as it turns its operations in Bedok South into a smart factory.
Panasonic Appliances Refrigeration Devices Singapore's manufacturing centre director Leong Mun Chong said: "When we talk about automation, the understanding is to reduce the number of jobs. This is true because, currently, we are relying on foreign workers... If we transform into a smart set-up, the reliance on foreign workers will be reduced and we can employ locals to manage advanced technology."
Mr Leong said that, overall, the transfer of the headquarters to Singapore from Kusatsu city, Shiga Prefecture, will result in an increase in staff numbers in the RCBU unit.
It could double the size of its research and development team to about 120 engineers in five years. "As a whole, it's an increase of staff. On the other hand, while implementing projects, we will be reducing the number of manual, operating jobs," said Mr Leong.
The company's phasing out of manual jobs will mainly affect its foreign workforce of about 350 workers, mostly from China.
Panasonic wants to cut this workforce by 200 workers in the next three to five years, said Mr Leong.
Panasonic Appliances Refrigeration Devices Singapore's managing director Atsunao Terasaki said: "We believe we can strengthen product competitiveness to gain better profit from customers.
"We can also increase our volume after moving our headquarters from Japan to Singapore."
He expects the move to double the company's profit ratio.
This article was first published on April 8, 2016.
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