UPDATE 2-Panasonic chief sees profit on TV business 2010/11

* Cost cuts, 3D TVs to boost TV profitability - president

* Group net loss for 2010/11 would be unacceptable - pres

* Sees little impact for now from Toyota safety crisis

* Shares end down 1.5 pct before comments, lag sector index

(Adds president comments, link to graphic, background)

By Kiyoshi Takenaka

TOKYO, March 3 (Reuters) - Panasonic Corp's (6752.T) TV business will likely turn profitable in the financial year from April after two straight years of losses, thanks to cost-cutting and the launch of higher-margin 3D TVs, its president said.

On its group performance, Fumio Ohtsubo told a group of reporters that posting a net loss in the next business year is not an option. Panasonic is forecasting a net loss of 140 billion yen ($1.6 billion) for the current year to March 31.

"We will be cutting costs, and we expect 3D TVs to bring more added-value to our products. I cannot say anything definite for the new year, but our TV operation will likely shed its loss-making status," Ohtsubo said on Wednesday.

Panasonic, the world's fourth-largest flat TV maker behind Samsung Electronics Co Ltd (005930.KS), LG Electronics Inc (066570.KS) and Sony Corp (6758.T), plans to launch 3D TVs this spring.

The sci-fi blockbuster "Avatar" and other recent titles have sparked massive interest in 3D films and prompted studios to plan a stampede of new movies, boding well for 3D TVs.

In a move to boost its company-wide profitability, Panasonic last month raised its target for fixed-cost reductions by 42 percent to 370 billion yen for the year ending in March.

"After posting a net loss for the 2008/09 and 2009/10 business years, a third straight loss for the next year would just be unacceptable," Ohtsubo said.

Analysts on average expect Panasonic, a maker of Viera flat TVs and Lumix digital cameras, to post a net profit of 119 billion yen for the year starting in April, according to a poll of 15 analysts by Thomson Reuters I/B/E/S.

Ohtsubo, a 39-year company veteran, said Panasonic sees little impact from Toyota Motor Corp's (7203.T) safety crisis, in which the automaker recalled more than 8.5 million vehicles and saw its U.S. sales falling almost 9 percent in February.

Toyota is the largest corporate client for Panasonic, whose products include car navigation systems and car audio.

"If their problem gets prolonged, that would naturally have some impact on us. But we are not really expecting this to drag on, and we are experiencing virtually no impact at the moment," Ohtsubo said.

Panasonic in December bought a majority stake in Sanyo Electric Co 6764.T, the world's No.1 lithium-ion battery maker and a major manufacturer of solar panels, taking aim at growing demand for renewable energy sources for cars, homes and offices.

Lithium-ion batteries are used to power a wide range of electronics such as notebook PCs and mobile phones as well as electric vehicles.

For a graphic of major lithium-ion battery makers' market share, click: here

Ohtsubo said Panasonic's auto battery operation will stay focused mainly on Toyota for now, and Sanyo's car battery business will keep its ties with various auto makers worldwide.

Panasonic runs a joint venture with Toyota to develop and make hybrid and electric car batteries, while customers for Sanyo's batteries include Honda Motor Co (7267.T), Ford Motor Co (F.N), Volkswagen (VOWG_p.DE) and PSA Peugeot Citroen (PEUP.PA).

Panasonic plans to make an announcement in May on how to achieve synergy between Panasonic and Sanyo and how to handle business overlaps, Ohtsubo said.

Prior to his comments, shares in Panasonic closed down 1.5 percent at 1,246 yen, underperforming the Tokyo stock market's electrical machinery index .IELEC.T, which was virtually unchanged. (Editing by Chris Gallagher and Jon Loades-Carter) ($1=88.72 Yen)