Why will Panels not upgrade? I get this error when I drush up panels:

Code updates will be made to the following projects: Panels [panels-7.x-3.4]

Note: A backup of your project will be stored to backups directory if it is not managed by a supported version control s
ystem.
Note: If you have made any modifications to any file that belongs to one of these projects, you will have to migrate tho
se modifications after updating.
Do you really want to continue with the update process? (y/n): y
Project panels was updated successfully. Installed version is now 7.x-3.4.
Backups were saved into the directory /home/bzisad0/drush-backups/newco/20141017210224/modules/panels.       [ok]
WD php: PDOException: SQLSTATE[42S02]: Base table or view not found: 1146 Table 'newco.cache_panels' doesn't [error]
exist: TRUNCATE {cache_panels} ; Array
(
)
 in cache_clear_all() (line 165 of
/var/www/vhosts/www.newco.com/releases/20131007153705/includes/cache.inc).
PDOException: SQLSTATE[42S02]: Base table or view not found: 1146 Table &amp;#039;newco.cache_panels&amp;#039; doesn&amp;#039;t exis
t: TRUNCATE {cache_panels} ; Array
(
)
 in cache_clear_all() (line 165 of /var/www/vhosts/www.newco.com/releases/20131007153705/includes/cache.inc).
Drush command terminated abnormally due to an unrecoverable error.                                           [error]
Backups were restored successfully.                                                                          [ok]
For some reason that table was never created in the database (this site started on an early version of 7, so perhap the Panels module didn't use a cache table back then???).  You can fix this by creating one that's identical to all the other cache_* tables:

CREATE TABLE `newco`.`cache_panels` (
  `cid` varchar(255) NOT NULL default '' COMMENT 'Primary Key: Unique cache ID.',
  `data` longblob COMMENT 'A collection of data to cache.',
  `expire` int(11) NOT NULL default '0' COMMENT 'A Unix timestamp indicating when the cache entry should expire, or 0 for never.',
  `created` int(11) NOT NULL default '0' COMMENT 'A Unix timestamp indicating when the cache entry was created.',
  `serialized` smallint(6) NOT NULL default '0' COMMENT 'A flag to indicate whether content is serialized (1) or not (0).',
  PRIMARY KEY  (`cid`),
  KEY `expire` (`expire`)
) ENGINE=InnoDB DEFAULT CHARSET=utf8 COMMENT 'Panels cache, manually created because Panels module would not upgrade without it'


Then you should be able to successfully upgrade the panels module:

$ drush up panels