Panasonic to move division headquarters to McAllen

McALLEN — Panasonic Electronic Devices Corp. of America plans to move its headquarters to McAllen as it restructures in response to the nationwide recession.

The company, which was previously based in Knoxville, Tenn., will also move its speaker assembly operation to an existing manufacturing plant in Reynosa, officials announced Tuesday.

Panasonic never intended to move the division headquarters to McAllen, said company spokesman Clark Brandon, but shrinkage in business has made it necessary to consolidate operations. The electronic devices division manufactures speakers, switches, capacitors and sensors — products tied to the health of the auto industry.

“When they slow down, we slow down,” Brandon said. “When they pick up, we pick up.”

Bankruptcy declarations at Chrysler Group LLC and General Motors Corp. earlier this year quickly took their toll on Panasonic Electronic Devices.

The electronics manufacturer was operating at only 60 percent of its business plan and had cut its workforce in Knoxville from a peak of 725 employees in 2002 to 170 in 2009.

The move to McAllen will further reduce Panasonic’s workforce in Knoxville to 80 employees, Brandon said. He does not expect the transfer to have a major impact on employment in the Rio Grande Valley.

But Panasonic’s move to McAllen represents a growing interest in the region among national companies, said Keith Patridge, president and CEO of the McAllen Economic Development Corp.

The area has a number of strong advantages, including good geography, a young workforce, and low labor costs, he said..

ALPS Automotive Inc. -- which designs and manufactures keyless entry systems and other electronic components for automobiles -- already has its division headquarters in McAllen.

And Fujitsu Ten Corp. of America -- which produces automotive audio, video, navigation and control systems -- has moved its manufacturing division to Reynosa.

Two other companies are considering moving divisions to the area as well, Patridge said. He declined to identify them at this stage in the deliberations.

Panasonic Electronic Devices should complete its speaker assembly move to Reynosa by December, said Brandon. Division headquarters is set to move into Panasonic’s administrative offices in McAllen by April 2010.

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Spence Kimball covers general assignments for The Monitor. He can be reached (956)683-4423.