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Nikon’s financial results may be impacted by the flooding in Thailand

Nikon factory in Thailand before the flooding

after the flooding

Nikon stock price dropped 3.5% as a result of the flooding in Thailand. Nikon may experience some serious financial losses if their Thailand plant stays closed for over a month:

"Nikon’s inventory of SLR cameras will probably last for about a month and the effect on earnings would be negligible should the company resume the plant’s operation within a month, Hisashi Moriyama, a JPMorgan analyst in Tokyo, said in a report dated yesterday. Suspensions lasting two months could cut Nikon’s revenue by 30 billion yen and operating profit by 5 billion yen to 10 billion yen, he said."

Via Businessweek, Image credits: BangkokbiznewsNoppatjak

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  • mark ph

    why not opening a factory in the Us? hahah

    • FrenchFlies

      -1

      • Banned

        Opening factories in third world countries to make additional profit has got to have a flip side…

        • Andrew

          That’s what he was asking for..

          Zing!

    • Billy

      High cost of production…ha ha!

  • http://www.jpgmag.com/people/markwjr Mark

    YES! More price increases! So stoked!

    Really, though, I feel terrible for them as a company. Why not move out of the destruction-ridden lands all together? They’re losing all this money anyhow. May as well do something about it.

    Mark

  • Dweeb

    I hear there’s an empty Leica plant at Midland Ontario Canada. We did win the war after all didn’t we? Why send your jobs to them?

    • Calibrator

      The war against Thailand? Man, you Americans are a busy folk!

  • Anonymous

    Natural disasters can happen anywhere. Remember the epic floods that Hurricane Katrina brought to the US? I am sure companies weigh those risks against the rewards when they decide to set up a factory in a given location.

    • silmasan

      +1 “Natural disasters can happen anywhere.”

      Finally, someone with good common sense. It’s nothing to do with being “third-world” or anything.

      • iamlucky13

        I would say it partially does. It’s really quite stunning the amount of earth you have to move to make certain buildings or roads in the US, because we spend a lot of money mitigating things like this. Even then, it’s still not always successful. A couple years ago a flood in Washington state severed Interstate 5, the main north-south road along a coast with something like 40 million residents. It was closed for the better part of a week.

        By the way, I can in about 15 minutes look up the 500 year flood maps for any location in my county. Do you suppose this information is as easily accessible, or even exists for much of Thailand? If I’m looking at potential locations to build a factory here, the effort needed to identify such hazards is trivial.

        We’re certainly not impervious in the US, but we do have a leg up in terms of the resources we have available to identify and mitigate natural disasters.

        • silmasan

          I can see where you’re coming from. Does that map (or any form of record), however, guarantee that the areas not shown to have been flooded in the last 500 years *will not ever* be flooded in the future? Or perhaps any other disaster as well? :)

  • Mandrake

    Wow, shows how high the water really is.

  • http://ronscubadiver.wordpress.com Ron Scubadiver

    May be impacted, how about it is almost certain Nikon will take a hit. I feel sorry for all those who have been harmed by this flood.

    They make SLR cameras there. That means short supplies of all DX models unless we get a bad surprise and find out D800 production was moved there after the earthquake.

    There is no way that factory will be operational in a month. I have been through all sorts of floods. It will take much longer.

    • Canontroll

      My home town hot flooded over a month ago.. So i hear you loud and clear :(

  • David

    What happened to their Malaysia factory?

  • Bob Danger

    inb4 inappropriate ISO jokes.

  • Nathan

    I know my 28-300 lens was made there. Hopefully they can get it open soon.

  • gt

    its just sad seeing these before and afters. this has got to be the worst year for Nikon ever. at least all the employees are safe

  • NG42

    No sympathy for Nikon or any of the other camera companies with their greedy pricing and their built in obsolescence.

  • NG42

    I do feel for the Thai workers though. But I would bet their corporate masters in Japan won’t be taking a pay cut as a result of any of this.

  • EnPassant

    Oh my … Comparing the photos it seem the whole area is submerged in 2 meter deep water! I wonder how much they could rescue to the second floor?

    • paf

      more like 4… if you look at the laps or some sort of marks on the pillars of entrance it is roughly 2 times a person’s height.

      I’d be curious to find out what kind of damage to machinery this produces — after all stock can be moved in anticipation of incoming floods but removing equipment from the factory hall is not so easy.

      This will not only hurt Nikon’s stock but also consumer’s pockets — I can’t wait for the price gouging to being.

      • EnPassant

        Well, it’s difficult to see exactly where the waterline is because of the mirroreffect in the water. Look instead at the big sign with ISO 9001 etc. Assuming the woman most close is about 1.60 meter the upper part of the sign seem to be 2 meter above ground, and is just above the water in the flooded photo.

  • brian

    I’d be curious to know what happened to Nikon’s share price after the “Nikon 1″ was released. Wasn’t there a surge in it’s price before the announcement?

    What happened after that? Were the markets happily surprised? Dissappointed? Did the price stay high with the announcement? Or did it drop?

    • nau

      also would be nice to know what are the sales of that thing after 1 month / 2 month

  • hc

    Nikon should move the factory to Penang, Malaysia, where the place do not have any
    natural disasters.

  • http://p43324at.pcriot.com patrick

    I worked in a foundery when that was flooded with just 3 feet of water and it took a month to get fully operational and that was a dirty steel works so to get a surgicaly clean enviroment up and running in a month is going to need a army of cleaners and special equipment all of which will cost millions

  • Dig

    I am sure Nikon has enough people who have imagination in sufficient quantity to overcome this event. For one Asia has the ultimate pool of potential customers. A matter of belief. After all, there is no such thing as a Nobel Prize for Economics, but it occurs that the belief is held, that there is, and in doing so, acted upon accordingly.

  • Catastrophile

    the lenses made during this period will be filled with water and as a result will have special optical properties, they’ll become telephoto.

  • BetaHal

    It’s already happening: Nikon’s stock 1-year return has been halved in a few days, from some 22% to around 11%. But maybe that ends being a good thing for Nikon: If you can’t manufacture, you can derive some of your resorces to developement, which certainly would be an investement for the future of the company.

    Maybe it’s time to begin designing a SERIOUS mirrorless camera, with real video modes à la GH2… Or maybe just an adapter that would allow Nikon lenses to autofocus on micro four thirds bodies and thus open a huge market for the Nikon glass… Anything but weeping and howling for the miseries that are coming upon you now, guys.

    C’mon, Nikon, wake up!

  • http://www.kenrockwell.com SorryForNikon

    Looks like they lost their ISO9001 certification because of the flood.

  • NikonFans

    That is why you open factories in Indonesia, Cmon Nikon, move your plant to Indonesia, we have more labor and cheaper wage = more profit for you… =p

  • Voodoochill

    Not being biased but why not move production to the Philippines? Sure we have our share of calamities but on the norm always come out unscathe. Theres lots of mountains there, Nikon can own one..^_^

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