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FOR IMMEDIATE RELEASE
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                (Tel: 03-3578-1237, Fax: 03-5472-7608)

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     Matsushita Electric Industrial Co., Ltd. (MEI [NYSE and PCX symbol: MC]) today announced that it has determined basic terms of business divisions/combinations to be implemented between MEI and two of its subsidiaries, Matsushita Communication Industrial Co., Ltd. (MCI) and Kyushu Matsushita Electric Co., Ltd. (KME), both of which will become wholly-owned subsidiaries through share exchanges on October 1, 2002. The memoranda of understanding (MOU) setting forth such terms were entered into today between MEI and each of MCI and KME. The purpose of these business divisions/combinations is to facilitate the groupwide business and organizational restructuring of MEI and its subsidiaries as announced on April 26, 2002 (see MEI's April 26, 2002 press release "Matsushita Announces Groupwide Business and Organizational Restructuring").
 
     The basic terms of the business divisions/combinations agreed upon today are outlined as follows:
 
 

1.	Division of MEI's communications equipment sales functions, and transfer of such to MCI

Purpose of business division

     As announced on April 26, 2002 in the above-mentioned press release "Matsushita Announces Groupwide Business and Organizational Restructuring," MCI will be reorganized under a new name "Panasonic Mobile Communications Co., Ltd." (PMC), effective January 1, 2003. As part of this reorganization, MCI will absorb the communication equipment sales unit to be divided from MEI's Corporate Information & Communications Sales Division in order to position PMC as a fully integrated mobile communications company.

Outline of business division
 

A.	Schedule
	September 26, 2002 Signing of memorandum of understanding Late October, 2002 (planned) Board resolutions to approve business division Late October, 2002 (planned) Signing of business division agreement January 1, 2003 (planned) Date of business division and transfer January 6, 2003 (planned) Date of commercial registration

B.	Method of business division and allotment of shares

     MEI will divide a certain part of its business and MCI will succeed the divided business in exchange for an allotment of 1 share of common stock of MCI. Preceding this business division and transfer, MCI (the succeeding company) is scheduled to become a wholly-owned subsidiary of MEI on October 1, 2002. Accordingly, the structure of this business division is adopted to maintain MCI as a wholly-owned subsidiary of MEI, in which MCI will allot 1 share of its common stock to MEI (the company dividing a business unit) upon the division and transfer.
 

C.	Rights and obligations to be succeeded

     Assets, liabilities, rights and obligations involved in the business to be transferred from MEI to MCI, which are considered to be mandatory for MCI (the succeeding company) to operate the business to be succeeded.
 

D.	Cash Distribution Upon Business Division

     There will be no cash distribution in relation to the business division.
 

E.	Prospects of paying debt obligations

     MEI believes that both MEI and MCI can pay the debt obligations to be incurred as a result of this transaction.
 

F.	New directors and corporate auditors of succeeding company

     To be determined.
 
Basic information for MEI and MCI (non-consolidated basis)

(as of March 31, 2002)

Trade Name Matsushita Electric Industrial Co., Ltd. (company to divide a unit) Matsushita Communication Industrial Co., Ltd. (succeeding company) Principal Lines of Business Manufacture and sale of electronic and electric equipment Manufacture and sale of information/communication, measuring/control, audio/video, office, medical, precision and other electronic equipment. Date of Incorporation December 15, 1935 May 31, 1944 Principal Office Kadoma-shi, Osaka, Japan Kohoku-ku, Yokohama, Japan Representative Kunio Nakamura, President Yasuo Katsura, President Capital Stock (million yen) 258,737 22,856 Shares Issued 2,138,514,603 188,149,981 Shareholders' Equity (million yen) 2,553,374 322,972 Total Assets (million yen) 4,565,972 517,292 Financial Closing Date March 31 March 31 No. of Employees 49,513 7,309 Major Customers Consumer products-- widely distributed to general public through consumer and household equipment sales networks. Business and industrial equipment and components-- sold mainly to corporations, government agencies and manufacturers through systems and industrial sales networks. MEI Major Shareholders and Shareholdings Sumitomo Mitsui Banking 4.56%     Japan Trustee Services Bank (Trust account) 4.52%     Moxley & Co. 4.45%     Sumitomo Life Insurance 3.58%     Mitsubishi Trust and Banking (Trust account) 3.16% MEI 56.33%     Japan Trustee Services Bank (Trust account) 3.23%     UFJ Trust Bank (Trust account A) 1.88%     Mitsubishi Trust and Banking (Trust account) 1.67%     Bank of New York for Goldman Sachs International 1.11% Major Banks Sumitomo Mitsui Banking, The Asahi Bank, etc. Sumitomo Mitsui Banking, The Asahi Bank, etc.

Note: Amounts less than one million yen have been omitted. (hereinafter the same)
 
Financial results for the most recent three fiscal years (non-consolidated basis)

(in millions of yen, except per share amounts)

Matsushita Electric Industrial Co., Ltd. (company to divide a unit) Matsushita Communication Industrial Co., Ltd. (succeeding company) Fiscal Year ended 2000/3 2001/3 2002/3 2000/3 2001/3 2002/3 Net Sales 4,553,223 4,831,866 3,900,790 693,123 817,844 562,417 Operating Profit (Loss) 75,228 76,634 (92,952) 56,255 51,241 (57,309) Recurring Profit (Loss) 113,536 115,494 (42,480) 58,373 52,285 (50,614) Net Income (Loss) 42,349 63,687 (132,410) 35,086 32,298 (46,630) Net Income (Loss) per Share (in yen) 20.53 30.63 (63.79) 186.48 171.66 (247.84) Annual Dividends per Share (in yen) 12.50 12.50 10.00 25.00 25.00 20.00 Shareholders' Equity per Share (in yen) 1,248.31 1,306.37 1,225.39 1,837.60 1,988.43 1,716.59

Description of the business to be divided
 

A.	Business to be divided

     The communications equipment sales unit of MEI's Corporate Information & Communications Sales Division.
 

B.	Operating results of the business to be divided for the year ended March 31, 2002

Net Sales Approximately 310 billion yen

C.	Assets and liabilities to be divided from MEI

     To be determined.
 
Business status of MEI after the business division and transfer
 
     There will be no significant changes in MEI's fundamental corporate status, including trade name, principal office, and representative.
 
 

2.	Division of MCI's automotive electronics and systems solutions businesses for transfer to MEI.

Purpose of business division
 
     As announced on April 26, 2002 (see previously-mentioned press release "Matsushita Announces Groupwide Business and Organizational Restructuring"), MEI will establish a new internal divisional company "Panasonic Automotive Systems Company," which will be responsible for the entire Matsushita Group's car electronics business, and another internal divisional company "Panasonic System Solutions Company," to be responsible for the Group's systems solutions business. Also, MEI will establish a new internal divisional company "Healthcare Business Company," which will be responsible for healthcare systems business. To implement these reorganizations, MCI will divide the car electronics business currently operated by its Automotive Multimedia Company and related divisions, and the systems solutions businesses run by its Systems Solutions Company and related divisions, and transfer them to MEI.
 
Outline of business division
 

A.	Schedule
	September 26, 2002 Signing of memorandum of understanding Late October, 2002 (planned) Board resolutions to approve business division Late October, 2002 (planned) Signing of business division agreement January 1, 2003 (planned) Date of business division and transfer January 6, 2003 (planned) Date of commercial registration

B.	Method of business division and allotment of shares

     MCI will divide relevant businesses and MEI will succeed the divided businesses. MCI (the company dividing business units) is scheduled to become a wholly-owned subsidiary of MEI on October 1, 2002, which will precede the business division and transfer. Accordingly, MEI (the succeeding company) will not issue shares of its common stock to MCI upon the division and transfer.
 

C.	Rights and obligations to be succeeded

     Assets, liabilities, rights and obligations involved in the businesses to be transferred from MCI to MEI, which are considered to be mandatory for MEI to operate such businesses.
 

D.	Cash Distribution Upon Business Division

     There will be no cash distribution in relation to the division.
 

E.	Prospects of paying debt obligations

     MEI believes that both MEI and MCI can pay the debt obligations to be incurred as a result of this business division.
 

F.	New directors and corporate auditors of succeeding company

     None.
 
Basic information for MEI and MCI
 
     See page 3 "Basic information for MEI and MCI" (please note that "the company dividing a unit" and "the succeeding company" are reversed in this case).
 
Financial results for the most recent three fiscal years
 
     See page 4 "Financial results for the most recent three fiscal years" (please note that "the company dividing a unit" and "the succeeding company" are reversed in this case).
 
Description of the business to be divided
 

A.	Businesses to be divided

     The automotive electronics business operated by MCI's Automotive Multimedia Company and related divisions, as well as systems solutions businesses run by MCI's Systems Solutions Company and related divisions.
 

B.	Operating results of the businesses to be divided for the most recent fiscal year

Net Sales Approximately 255 billion yen

C.	Assets and liabilities to be divided from MCI

     To be determined.
 
Business status of MEI after the business division and transfer
 
     There will be no significant changes in MEI's fundamental corporate status as the succeeding company, including trade name, principal office, and representative.
 
 

3.	Joint business division in the manufacturing systems area between MEI and KME

Purpose of business division
 
     As announced on April 26, 2002 (see the aforementioned press release "Matsushita Announces Groupwide Business and Organizational Restructuring"), "Panasonic Factory Solutions Co., Ltd." (PFSC) will be established by combining manufacturing systems businesses of both MEI and KME. In forming PFSC, MEI will divide the relevant business currently operated by its FA Company, an internal divisional company. Also, KME, which will become a wholly-owned subsidiary of MEI through a share exchange on October 1, 2002, will divide the related business currently run by its FA Division, for transfer into the new company.
 
Outline of business division
 

A.	Schedule
	September 26, 2002 Signing of memorandum of understanding Late October, 2002 (planned) Board resolutions to approve business division January 1, 2003 (planned) Date of business division and transfer January 6, 2003 (planned) Date of commercial registration

B.	Method of business division and allotment of shares

     To establish PFSC as a wholly-owned subsidiary of MEI, the new company (PFSC) will allot one (1) share of its common stock to MEI (the company dividing a business unit) upon its succession of the manufacturing systems business currently operated by MEI's FA Company. At the same time, PFSC will allot another one (1) share to MEI as the shareholder of KME (also dividing a business unit) upon succession by the new company of the manufacturing systems business currently run by KME's FA Division.
 

C.	Rights and obligations to be succeeded

     Assets, liabilities, rights and obligations involved in the businesses to be transferred from MEI and KME, which are considered to be mandatory for the new company to operate the business to be succeeded.
 

D.	Cash Distribution Upon Business Division

     There will be no cash distribution in relation to the division.
 

E.	Prospects of paying debt obligations

     MEI believes that each of MEI, KME and the new company can pay the debt obligations to be incurred as a result of this business division.
 

F.	New directors and corporate auditors of succeeding company

     To be determined.
 
 
Basic information for MEI and KME (non-consolidated basis)
 

(as of March 31, 2002)

Trade Name Matsushita Electric Industrial Co., Ltd. (company to divide a unit) Kyushu Matsushita Electric Co., Ltd. (company to divide a unit) Principal Lines of Business Manufacture and sale of electronic and electric equipment Manufacture and sale of information, office automation and industrial equipment, and electric components. Date of Incorporation December 15, 1935 April 10, 1951 Principal Office Kadoma-shi, Osaka, Japan Hakata-ku, Fukuoka, Japan Representative Kunio Nakamura, President Hajime Sakai, President Capital Stock (million yen) 258,737 29,845 Shares Issued 2,138,514,603 175,140,847 Shareholders' Equity (million yen) 2,553,374 156,735 Total Assets (million yen) 4,565,972 231,295 Financial Closing Date March 31 March 31 No. of Employees 49,513 5,610 Major Customers Consumer products-- widely distributed to general public through consumer and household equipment sales networks. Business and industrial equipment and components-- sold mainly to corporations, government agencies and manufacturers through systems and industrial sales networks. MEI Major Shareholders and Shareholdings Sumitomo Mitsui Banking 4.56%     Japan Trustee Services Bank (Trust account) 4.52%     Moxley & Co. 4.45%     Sumitomo Life Insurance 3.58%     Mitsubishi Trust and Banking (Trust account) 3.16% MEI 51.52%     Sumitomo Mitsui Banking 2.63%     Kyushu Matsushita Electric Employee Shareholders' Association 2.40%     Japan Trustee Services Bank (Trust account) 2.37%     Mitsubishi Trust and Banking (Trust account) 2.18% Major Banks Sumitomo Mitsui Banking, The Asahi Bank, etc. Sumitomo Mitsui Banking, The Asahi Bank, etc.

Note: Amounts less than one million yen have been omitted. (hereinafter the same)
 
Financial results for the most recent three fiscal years (non-consolidated basis)

(in millions of yen, except per share amounts)

Matsushita Electric Industrial Co., Ltd. (company to divide a unit) Kyushu Matsushita Electric Co., Ltd. (company to divide a unit) Fiscal Year ended 2000/3 2001/3 2002/3 2000/3 2001/3 2002/3 Net Sales 4,553,223 4,831,866 3,900,790 313,823 330,883 298,902 Operating Profit (Loss) 75,228 76,634 (92,952) 5,063 7,686 3,404 Recurring Profit (Loss) 113,536 115,494 (42,480) 5,206 7,022 2,915 Net Income (Loss) 42,349 63,687 (132,410) (4,041) 3,513 (2,628) Net Income (Loss) per Share (in yen) 20.53 30.63 (63.79) (22.92) 19.92 (14.95) Annual Dividends per Share (in yen) 12.50 12.50 10.00 10.00 10.00 10.00 Shareholders' Equity per Share (in yen) 1,248.31 1,306.37 1,225.39 915.20 920.51 895.08

Description of the business to be divided by MEI
 

A.	Business to be transferred

     The manufacturing systems business of the FA Company.
 

B.	Operating results of the business to be divided for the most recent fiscal year

Net Sales Approximately 85 billion yen

C.	Assets and liabilities to be divided

     To be determined.
 
Business status of MEI after the business division and transfer
 
     There will be no significant changes in MEI's fundamental corporate status, including trade name, principal office, and representative.
 
Information about the newly established company
 

A.    Trade name:	Panasonic Factory Solutions Co., Ltd.
B.    Principal lines of business:	Development, manufacturing and sales related to circuit manufacturing, parts mounting and other manufacturing systems, and related service and engineering.
C.    Principal office	Minato-ku, Tokyo, Japan
D.    Representative:	To be determined
E.    Capital stock:	To be determined
F.    Total assets:	To be determined
G.    Financial closing date:	March 31

Information about the newly established company
 
     The business divisions referred to in 1, 2 and 3 will have no immediate material effect on MEI's consolidated financial results. Toward the future, it is expected that the business divisions will increase management efficiency, thus leading to the possible contribution to operational performance improvements of the entire Matsushita Group.
 
Disclaimer Regarding Forward-Looking Statements
     This press release includes forward-looking statements (within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934) about Matsushita and its group companies (the Matsushita Group). To the extent that statements in this press release do not relate to historical or current facts, they constitute forward-looking statements. These forward-looking statements are based on the current assumptions and beliefs of the Matsushita Group in light of the information currently available to them, and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause the Matsushita Group's actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. Matsushita undertakes no obligation to publicly update any forward-looking statements after the date of this press release. Investors are advised to consult any further disclosures by Matsushita in its subsequent filings with the U.S. Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934 and its other filings.
     The risks, uncertainties and other factors referred to above include, but are not limited to, economic conditions, particularly consumer spending and corporate capital expenditures in the United States, Europe, Japan and other Asian countries; volatility in demand for electronic equipment and components from business and industrial customers, as well as consumers in many product and geographical markets; currency rate fluctuations, notably between the yen, the U.S. dollar, the euro, Asian currencies and other currencies in which the Matsushita Group operates businesses, or in which assets and liabilities of the Matsushita Group are denominated; the ability of the Matsushita Group to respond to rapid technological changes and changing consumer preferences with timely and cost-effective introductions of new products in markets that are highly competitive in terms of both price and technology; the ability of the Matsushita Group to realize expected benefits of various restructuring activities in its business and organization, including the share exchanges with subsidiaries currently in progress; the ability of the Matsushita Group to achieve its business objectives through joint ventures and other collaborative agreements with other companies; the ability of the Matsushita Group to maintain competitive strength in many product and geographical areas; any changes in the Matsushita Group's financial and operational position or business environment due to its business restructuring; current and potential, direct and indirect trade restrictions imposed by other countries; and fluctuations in market prices of securities and other assets in which the Matsushita Group has holdings, as well as future changes or revisions to accounting policies or accounting rules.

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