With a number of significant Formula 1 sponsors already well known to be feeling the economic pinch in the wake of the current global credit crunch, it has now been suggested that Toyota title backer Panasonic and Williams' investor Philips could be set to either reduce or scrap their support too.

According to the Associated Press, Panasonic President Fumio Ohtsubo has revealed that the company is to implement some cut backs over the coming financial year, in addition to pulling out of certain businesses and products and closing down some foreign manufacturing plants.

'Panasonic Corp. said it will cut 560 jobs in Asia due to the closure of two plants in the region,' reported AP, 'while declining to confirm a report saying the Japanese electronics giant will likely suffer its first net loss in six years.'

In November, the US-based Bleacher Report claims, 'Panasonic slashed its full-year sales and profit forecast by about 90 per cent' - from an expected annual net profit of 310 billion yen back at the beginning of the financial year to just 30 billion yen ($315 million). Leading Japanese business newspaper Nikkei has predicted that the net loss could be as great as 100 billion yen ($1.1 billion).

To blame for that dramatic slump, Panasonic has stated, are reduced consumer spending, lack of product demand, poor export prospects given the appreciation of the yen and restructuring costs.

Moreover, chief rival Sony has confirmed a nigh-on 95 per cent fall in its third quarter profit from nearly 200 billion yen ($2.2 billion) in 2007 to about 10 billion yen ($110 million) in 2008, and the company is set to end the fiscal year counting an operating loss of 260 billion yen ($2.9 billion), its first in 14 years.

Dutch conglomerate Philips, meanwhile, has reported a fourth quarter loss of EUR1.47 billion and is set to lose as many as 6,000 jobs, with 'cost-cutting' understood to be of the essence. With Williams already facing the potential loss of key backer the Royal Bank of Scotland, should Philips also withdraw it would be a hefty blow indeed.