Panasonic Corp will reduce plasma TV panel production and lay off about 1,000 people, a source told Reuters on Thursday, as its loss-making television unit struggles to compete with Asian rivals like Samsung Electronics.

 Panasonic will stop plasma panel production at its Amagasaki No 3 factory in Hyogo prefecture, western Japan, by the end of the financial year in March 2012, the source said.

The company is also considering selling off a liquid-crystal display panel plant in Mobara in Chiba prefecture, next to Tokyo, the source said.

A spokesman for Panasonic said the company was considering various options for its television business, but had nothing to announce at this point.    

The electronics giant said in April it would axe 17,000 jobs and close dozens of plants over the next two years in a bid to pare costs and get rid of overlapping businesses following its takeover of rival Sanyo.

In July, the company said it may not stick to its annual sales target of 25 million televisions, instead prioritising profits. The state-of-the-art Amagasaki No. 3 plant has monthly capacity of 330,000 panels, calculated in 42-inch panel equivalents, and was completed in December 2009.

The Yomiuri newspaper, which reported the news earlier, said Panasonic would cut staffing by several thousand. Panasonic, along with domestic rivals Sony and Sharp , is struggling to compete with the likes of South Korea's Samsung and LG, especially after a sharp rise in the yen against other major currencies.  - Reuters