Panasonic gets closer to European market

The cooperation with former Flyer maker Biketec in Switzerland gave e-bike drivetrain pioneer Panasonic Cycle Technology Co., Ltd. (PCT) an early presence on the European market. Bike Europe got a unique insight into the PCT head office and factory near Osaka. Why were the Japanese not so successful in Europe with their extremely reliable drivetrain during the e-bike boom?

It is clear that Panasonic’s new European Service Center near Munich, Germany gives them better access to the European market. For the first time they offer a drivetrain system specifically developed for the European market.

Strong domestic market penetration

While PCT tends to be perceived in Europe as a manufacturer of pedelec drivetrains, things are quite different in its native Japan. On its home market PCT is one of the largest bicycle brands running its own manufacturing. “More than 90% of our total bicycle production in the Kashiwara facility is e-bikes and we now hold a market share of over 50% on the e-bike market in Japan,” PCT General Manager Overseas Sales Department Kazuhiro Suzuki explains, not without pride.

The Panasonic e-bikes are designed exclusively to meet the specific preferences of the domestic market. The success shows that PCT has met the taste of the domestic clientele. The annual capacity of the PCT factory is about 400,000 units. According to PCT Assistant Chief Overseas Sales Section and Overseas Sales Department Takashi Kasai, PCT also builds approximately 1,000 regular bikes every year. However, the real production numbers of e-bikes and export volumes are regarded as strictly confidential information.

Foundations of Panasonic

Company founder Kōnosuke Matsushita had always an eye on bicycles. In 1918, he founded Matsushita Electric Housewares Manufacturing Works. This laid the foundation for today's electronics giant Panasonic. Already in 1935 it was renamed Matsushita Electric Industrial Co. Ltd and since 2008, the conglomerate has been operating under the name Panasonic Corporation. With the Sanyo takeover two years later, it also secured further battery cell and battery pack know-how. As early as 1952, the corporate group founded the subsidiary National Jitensha Kōgyō (now Panasonic Cycle Technology) ‘for the purpose of developing and production of bicycles.’

Too slow with exports

According to PCT PR manager Kuniyashi Ikai, pedelecs and bicycles account for about 90% of the company’s sales and the pedelec drivetrains for about 10% today. With the domestic pedelec market success in mind, it is understandable why PCT was hesitant to capitalize on the export market for a long time and to meet demand for special requests from overseas customers. According to some insiders PCT waited too long. “The willingness within the company to respond to overseas requests had a low priority,” explains European industry insiders. “PCT preferred to focus on the domestic market. All innovations were first tested and introduced in Japan.”

At some point, however, e-bike developments in Europe started to run differently and faster. The Japanese were not prepared for this. For example, Western suppliers wanted a larger battery capacity for e-MTBs or speed pedelecs, which don’t exist in Japan. That all passed by PCT completely.

European partners

That’s the reason why the less than 10 European e-bike suppliers specifying the Panasonic system no longer rely on their batteries. Main customer Flyer only purchases the reliable PCT mid-motor. This motor is only part of the Swiss own ‘all-in-one’ solution they put on the market as the Flyer Intelligent Technology.

Four other important battery partners in Europe are BMZ, Greenway, PortaPower and Trendpower. PCT now offers its drivetrain system in conjunction with the lithium-ion batteries of each of these suppliers. The four partners supply European e-bike brands with the Japanese drivetrain system together with their own battery packs in any requested design and larger capacity. Here, Panasonic has simply missed out on Western pedelec developments.

No success model for direct service

“Another hurdle was that Panasonic, as a successful consumer goods seller, never addressed the issue of after-sales service because we didn't see it as our strength and never strived for it,” explains Kazuki Suzuki. “European market leader Bosch eBike Systems followed the success model of Shimano with direct service. Today, we know they both have been very successful with this model.”

Panasonic responded eventually. In August 2021 PCT signed a cooperation agreement with German battery specialist BMZ GmbH. Since then, the group has been supplying complete drivetrain systems including their mid-motor and display together with the BMZ battery packs to European OEMs. BMZ also took over their service activities. According to Suzuki, these have been already expanded to direct service for IBDs. These service activities are coordinated by the newly created PCT European Service Centre, which is integrated into Panasonic Industry Europe GmbH. The PCT European Service Centre also includes the company’s own e-bike drivetrain service department.

Getting closer to European market

All these activities are part of the company strategy to gain ground in Europe and to get close to the beating heart of the European market. In line with the market developments, PCT has not only made progress with the performance of the motor, but also the displays have become more technically advanced. For the displays PCT could also benefit from the know-how of its parent Panasonic Corporation.

Kellys has been working with PCT for some time. The Slovakian bike manufacturer handles all Panasonic services for its customers in-house at its factory. Kellys’ frontman in Germany Andreas Makowsky stated he is impressed by the new Bluetooth color display with navigation display. It is Komoot-compatible and can be combined with the Wahoo app. It also allows cadence data to be added to all Strava ride records.

Inside the motor assembly factory

The (single-axle) e-bike motors for the European market are all assembled in PCT’s Kashiwara factory. All related parts are delivered by domestic subcontractors. On assembly lines, cables and plugs are laid step by step inside the motor by hand. Everything has its place, as is the case everywhere in detail-oriented Japan. Finally, the electronics are encapsulated to make them watertight, and the motor housing is sealed. Suzuki and his team attach great importance to the fact that all motors for export come exclusively from Kashiwara, Japan. Drivetrains for the domestic market, including two-axle ones’, might come from a factory in China.

Pedelec production for domestic market only

The first floor of the PCT headquarters and factory houses the test centre equipped with every test machine you could think of. The same floor also houses the semi-automated frame production. Here the steel tubes are delivered by the meter, then they are cut, bent and welded by automatic machines. As soon as the finished frames come off the hook, they are inspected and reworked by hand by the factory’s comparatively few workers. Painting, assembly and packaging are also in-house. Aluminium frames, by the way, are used only sporadically. They are imported.