News Release：Pioneer Sets up a New Subsidiary in Sweden Pioneer Scandinavia AB

Tokyo, Japan, Jan 25, 1999 --- Pioneer Electronic Corporation has announced that Pioneer Electronic Svenska AB became a wholly owned subsidiary of Pioneer, Pioneer Scandinavia AB, as of Jan 15, 1999.

By establishing the new subsidiary, Pioneer is well positioned to carry integrated business activities in Northern Europe, including Sweden, Norway and Denmark, and it aims to improve efficiency in operations and distribution as well. This is no doubt one of the Pioneer’s effective market strategies in response to the new advent of European Union market.

Mr. Gunnar Holm, new Managing Director of Pioneer Scandinavia AB and previous owner of Pioneer Electronic Svenska AB, has remarked that his company has had close relationship with the Pioneer headquarter in Japan for many years, and that he is very pleased that his company became a Pioneer’s subsidiary in Northern Europe.

During spring, 1999, Pioneer Scandinavia AB plans to move their warehouse from Stockholm to a new Scandinavian place so that it can be operated in consolidation with the Pioneer’s other subsidiaries in Denmark (Pioneer Electronics Denmark A/S) and Norway (Pioneer Electronics Norge A/S).

Pioneer in Sweden was founded in 1969 by Mr. Gunnar Holm, owner as well as President of the company and since then, Pioneer Electronic Svenska AB has actively been sole distributor of the Pioneer brand in the Swedish market. The line of business covers Home and Car Electronics products as well as Computer related products such as CD-ROM / DVD-ROM drives and data storage products.

The company now intends to focus its marketing activities on introduction of DVD players and Plasma Display Panels (PDP), newly developed flat screens that are expected to revolutionize large screen viewing.

Profile of the New Company

• Name: Pioneer Scandinavia AB
• Address: Nyckelvagen 4, S-142 82 Transgsund, SWEDEN
• Capital: 2.0 mil. SEK
• Stockholder: Pioneer Electronic (Europe) N.V. 100%
• Chairman: Shungo Minato
• Managing Director: Gunnar Holm
• Employees: 39