Panasonic Showcases AI Component Layout at CIIE: MEGTRON Substrate Material Global Capacity to Double by 2030

The 9th China International Import Expo has arrived as promised, and Panasonic has also embarked on its ninth consecutive year of participation. Based on the Panasonic Group growth strategy released in 2026, Panasonic announced a new regional strategy in China. Facing the new development stage of China's "15th Five-Year Plan," Panasonic in China will respond to the needs of the times through three major business areas: AI infrastructure, advanced manufacturing, and healthy intelligent living spaces. At this year's CIIE, Panasonic presents a panoramic display centered on its three key business areas, among which the components segment for AI infrastructure has become one of the core highlights of the entire exhibition. Unlike a single-product display, this year's Panasonic AI infrastructure components exhibition area covers Panasonic Industry's electronic materials and core components as well as Panasonic Energy's full-category battery solutions, providing underlying material and component support for AI computing hardware while also building a stable energy supply system for computing facilities and livelihood scenarios. Through the open platform of the CIIE, Panasonic fully presents its comprehensive layout and long-term thinking in the fields of AI underlying hardware and energy assurance, and also sends the industry a clear signal of taking root in China and jointly building the AI industry ecosystem.

Photo: 2026 CIIE Panasonic Booth - AI Infrastructure Components Exhibition Area

In April 2026, Panasonic Group completed its transition to a new system, forming a structure of seven business companies under the coordination of a holding company. In the group growth strategy released in May of the same year, Panasonic clarified its three core business areas: components, solutions, and intelligent living, establishing "businesses supporting AI infrastructure" and "businesses supporting social operations" as its two major growth pillars. Among them, the components field is clearly positioned as the group's "growth catalyst," undertaking the core mission of providing underlying support for AI computing power and driving the group's short-term rapid growth.

Matching this is a clear phased operating target: the group strives to achieve adjusted operating profit of 780 billion yen in fiscal 2026. From the perspective of performance, this growth path is already being realized at an accelerating pace—benefiting from data center demand, AI infrastructure-related businesses and surrounding fields have further accelerated growth beyond expectations. In the second quarter of fiscal 2026 (July to September) for Panasonic Holdings, profits grew in all business segments, and following the first quarter, it once again set a record for the highest profit in history. The full-year performance forecast was also significantly raised, and the China Northeast Asia region achieved both revenue and profit growth.

In the Chinese market, Panasonic's positioning has long shifted from a mere sales market to the origin point for creating global competitiveness. As Masaharu Nakayama, Executive Officer of Panasonic Holdings Corporation and Group Chief Executive for China & Northeast Asia, put it, "China cost is global standard cost." The product strength, cost strength, and digital capabilities honed in the fierce competition of the Chinese market are becoming the core confidence for Panasonic Group's global growth.

As of fiscal 2025, Panasonic's China Northeast Asia region has 58 legal entities and 43,000 employees, including 10,000 R&D personnel. The region's overall sales are 2 trillion yen, accounting for 24% of the group's global sales scale, making it one of the group's most important overseas R&D and manufacturing bases. Leveraging its massive local industrial scale, Panasonic takes its AI components business as the core lever for regional implementation, guided by the three major policies of "China cost, China speed, China model," to comprehensively advance a localized closed loop in R&D, supply chain, and manufacturing.

On the R&D side, Panasonic continues to expand its local technical and R&D talent team, advances localization reform of product development processes, and shortens response cycles; on the manufacturing side, it accelerates the localization and substitution of key raw materials such as glass cloth, copper foil, and resin, while implementing digital production systems to improve manufacturing efficiency and quality stability; in terms of capacity layout, Panasonic continues to increase local investment in the electronic materials field, consolidating local supply capacity for AI core components through the construction and expansion of factories in Guangzhou, Suzhou, and other locations. This localized combination has made the China Northeast Asia region a true physical foundation supporting the growth of Panasonic's AI components business, and has also accumulated practical experience for the subsequent global output of "China for Global."

At this year's CIIE, with the high-performance multilayer substrate material MEGTRON as the core, Panasonic presents a component product matrix covering AI computing infrastructure and AI edge devices, complemented by the full-scenario energy assurance capability of new energy batteries, forming a support system spanning materials, devices, and energy.

The high-performance multilayer substrate material MEGTRON is Panasonic's flagship product for AI computing infrastructure and also the core highlight of this year's CIIE components exhibition area. With Panasonic's proprietary material formulation and precision manufacturing processes, this product has the core advantages of ultra-low transmission loss and high heat resistance, effectively ensuring high-speed signal integrity while suppressing equipment power consumption and temperature rise. It directly drives performance upgrades of high-speed communication network equipment and AI servers, and is a key foundational material supporting the increase of computing density.

Photo: Panasonic high-performance multilayer substrate material "MEGTRON"

To meet the robust market demand for AI infrastructure, Panasonic is accelerating capacity expansion and plans to double the global capacity of the high-performance multilayer substrate material MEGTRON by 2030. China is the core production base for MEGTRON, and Panasonic has invested a total of approximately 2.2 billion yuan in its two major bases in Guangzhou and Suzhou. Among them, the first phase of the new Suzhou electronic materials factory was officially completed and opened in June this year and will begin mass production in December; on October 30, Panasonic further announced increased investment to build a second-phase factory, expected to start production in August 2028, with all work currently proceeding in an orderly manner.

In addition to substrate materials, Panasonic also showcased a full range of products for the computing-power side and the power side: core components such as conductive polymer aluminum electrolytic capacitors and semiconductor component materials, suited to the needs of highly integrated computing hardware; and the AIDC (artificial intelligence data center) liquid cooling pump, as a core component of the liquid cooling loop, directly determines heat dissipation and delivery capacity, supports the continuous and stable operation of servers, and, together with cooling infrastructure and energy infrastructure solutions, provides data centers with integrated underlying support from power supply to heat dissipation.

Image: Panasonic data center components

Supporting all of this is also Panasonic Energy's energy system. As a manufacturer with more than 40 years of battery technology accumulation, Panasonic Energy's China sites can provide one-stop energy solutions from cells to battery packs, covering the full range of prismatic lithium-ion, cylindrical, and pouch batteries as well as nickel-metal hydride batteries and lithium primary batteries, widely used in scenarios such as consumer goods, power tools, rail transit, and medical equipment, building a stable energy foundation for the diverse energy needs of the AI era.

Image: Panasonic lithium-ion battery modules

What Panasonic presented at the CIIE is not just individual products, but a set of systemic capabilities covering the entire AI industry chain. And the core advantage running through all products is the "comprehensive reliability" that Panasonic has accumulated over 48 years of deep cultivation in the Chinese market—it goes beyond stable product quality to include supply assurance capability, deep technology accumulation, and long-term customer companionship, which is also the core reason many leading customers choose long-term cooperation with Panasonic.

Take supply-demand balance, for example. On the one hand, AI computing power demand is showing explosive growth, but capacity expansion for core components requires a ramp-up cycle, and a short-term supply-demand gap objectively exists. How to precisely match customer demand with factory capacity and how to prioritize among different customers and projects is essentially a strategic choice concerning long-term trust.

A deeper challenge comes from escalating competition and the balance of localization. With the rapid rise of Chinese local equipment and materials manufacturers, compounded by persistently high raw material prices, industry competition has long extended from a single price dimension to all-round competition in development speed, supply chain efficiency, AI application capability, and more. And the most core proposition is: how to truly achieve "China speed" and "China cost" while adhering to the core moat of "Panasonic quality"—this requires companies to carry out more thorough localization reforms in process mechanisms, decision-making systems, and authorization models.

V. From local deep cultivation to global output: the long-term path of China for Global

For Panasonic, the Chinese market is not only a growth battleground of the present, but also the core training ground for forging global competitiveness. Panasonic's long-term goal is to feed the AI component technologies, supply chain management capabilities, and digital practices honed and matured in the Chinese market back to the world, promoting the global implementation of "China cost, China speed, China model."

This path already has a clear practical direction. Panasonic Energy's China sites are actively exporting local high-quality materials, equipment, and talent resources overseas, replicating the cost and efficiency advantages refined in China to global markets. Its underlying logic is clear and firm: first validate products and business models in the most fiercely competitive Chinese market, then promote mature solutions to markets such as Southeast Asia, Europe, and North America, both hedging against the pressure of involution in the local market and helping the group's global business compete against low-price rivals, forming a positive cycle of "trained in China, benefiting globally."

During this CIIE, Masaharu Nakayama will take the stage at the official press conference as the group's chief representative for China and Northeast Asia for the first time, releasing Panasonic's new regional strategy in China for the "15th Five-Year Plan" and sending more signals about the layout of its AI components business. It can be foreseen that in the future Panasonic will continue to deeply participate in China's AI infrastructure construction, deepen strategic cooperation with leading local customers, jointly define next-generation products and technical standards, and achieve its own business growth in the process of integrating into China's industrial ecosystem.

Final notes:

From participating in the CIIE for nine consecutive years to positioning China as the source of global competitiveness, Panasonic is in the industrial transformation of the AI era using components as its core lever to build a solid foundation for long-term growth. For the Panasonic Group, the AI components business is the core catalyst driving future growth and the key carrier for undertaking the group's growth strategy; for China's AI industry, Panasonic's product capabilities and full-cycle reliability assurance also provide solid support for computing infrastructure construction and industrial upgrading.

Through the open window of the CIIE, Panasonic has demonstrated both its current product layout and technological accumulation and its determination to take root in China for the long term and prosper together with the industry. In the future, as the "China for Global" strategy continues to deepen, technological innovation, supply chain capabilities, and industrial practices originating in China will become Panasonic's core confidence in participating in global AI industry competition, and will also contribute China's industrial strength to the development of the global AI industry.