In the most dire warning, Sharp forecast on Thursday a 450 billion yen  ($5.6 billion) full-year loss and warned that it had “material doubts”  about its ability to survive.        
On the same day, Panasonic’s  shares lost a fifth of their value in Tokyo after the company forecast a  765 billion yen ($9.6 billion) annual net loss from write-downs in its  solar-power, battery and mobile handset businesses.         And Sony,  perhaps the best positioned of the companies, posted a net loss of 15.5  billion yen ($194 million) for the quarter on Thursday and warned of  falling sales in almost every product it sells.         “We have a lot of great technology which we want to tap to revive and  generate profit, but the company does not have that vitality,” Takashi  Okuda, Sharp’s chief executive, told reporters after the company posted a  net loss of 249 billion yen ($3.1 billion) for the three months to  September. The loss was far larger than expected.        
In a statement, the company said it had a “serious negative operating  cash flow” which raised “serious doubts” about its ability to continue  as a going concern, and said it was taking steps, including pay cuts,  voluntary redundancies and asset sales, to generate cash flow.        
While Sharp is in the most serious trouble, the three companies’ woes are similar at the core.        
All three make good quality, even cutting-edge products — but so do  their overseas competitors, usually at lower prices. None of the three  have managed to generate the brand pizazz of Apple, or the marketing  muscle of Samsung Electronics. In addition, a stubbornly strong yen  continues to sap their competitiveness, while Japan’s territorial  dispute with China has hurt sales there.        
The scale of the losses is the result of specific missteps, from huge  investments in the wrong technologies to a reluctance to exit  loss-making businesses. A manufacturing bubble here in the mid-2000s —  fed partly by an unusually weak currency and Americans flush with cash  from rising home prices — masked continued weaknesses in their business  models and spurred the companies to take big bets that backfired.         
When the global financial crisis brought that boom to an end in 2008,  the three were saddled with excess capacity, bloated work forces and  investments that they could hardly hope to recoup. And their refusal to  make a big enough departure from the ways of their glory years is now  making a comeback difficult.        
“Many investors are longing for reforms that will let all of the pus  out,” Yuji Fujimori, technology analyst at Barclays Capital in Tokyo,  said in a recent note to clients.        
Sharp’s stumble, in many ways, has been the most humbling. It was the  biggest beneficiary of the manufacturing bubble: from 2000 to 2007, its  profits jumped 150 percent. Sharp’s high-end Aquos liquid-crystal  display televisions — which it manufactured at state-of-the-art  factories in Kameyama, in western Japan — were a runaway hit in the  nascent flat-panel market. The spinoff Aquos cellphone topped Japanese  sales rankings. Sharp’s solar batteries also sold briskly, helped by a  bubble in green technologies.        
The company’s success during this period seemed to validate Japan’s  penchant for manufacturing their most important products in-house. In  advertisements, Sharp showed off its cutting-edge factories.        
But even before the financial crisis, analysts were warning of an  impending crash in prices of flat-panel televisions, which were fast  becoming commodities that cheap upstarts could emulate. In 2008, the iPhone made its debut in Japan, the end of an era for Japanese-style  cellphones. Chinese upstarts were starting to flood global markets with  cheap solar panels and batteries. In consumer electronics, outsourced  manufacturing became the norm.         Still, Sharp did not change course. It built a new factory in Sakai,  Japan, which could make 6 million large LCD panels a year — more than  the size of the global market at the time. Sharp missed the smartphone  wave, and its cellphone sales in Japan halved from 2007 to 2012. And in  late 2011, the solar bubble burst, driving many solar power companies into bankruptcy and Sharp’s solar batteries business into the red. The unit has not turned a profit since.         Now, the Kameyama factories no longer make televisions but panels for Apple’s iPhones and iPads.        
Panasonic, for its part, also bet heavily on plasma televisions in 2003,  pouring some 600 billion yen into a series of factories in Amagasaki,  not far from Sharp’s own plant. It also bet on solar panels and  rechargeable batteries, buying Sanyo in 2009.        
But with plasma now a fading technology and solar power struggling,  Panasonic is saddled with major losses. Last year, it announced that a  factory in Amagasaki was closing, less than two years after it opened.         
Kazuhiro Tsuga, who took the helm at Panasonic this year, was blunt in  describing his company’s predicament. “We are among the losers in  consumer electronics," he told a news conference on Wednesday. He now  promises to shift the company away from money-losing televisions and  gadgets. 
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