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Nikon expects declined sales in China that could be caused by the recent boycott of Japanese products

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Several news media outlets reported last month on the boycott of Japanese products in China caused by the recent Japanese government’s purchase of some of the Diaoyu islands which are claimed also by China. It seems that the issue is serious enough that Nikon mentioned it in their latest Q&A session for the Q2 financial results of the Imaging Division:

Q: What can you tell us about the digital camera market?

A: The market for digital cameras with interchangeable lenses grew by approximately 20% in the first half compared to the same period in the previous year however the compact digital cameras market fell by approximately 20%. Amidst this business environment, Nikon achieved growth in unit sales above market growth and increased its market share across all product segments. Global share for the recent 2Q saw us regain our market share of above 40% for digital SLR cameras by overcoming the influence of the floods in Thailand while we achieved just over a 20% market share for non-reflex cameras and compact digital cameras. With respect to market size for the full year, our forecasts for digital cameras—interchangeable lens type and interchangeable lenses remains unchanged on the back of strong growth in these areas. However, with the downturn in the economy of emerging countries and the impact of smartphones, we expect the market for compact digital cameras to contract further by 15 million units to 80 million units.

Q: What can you tell us about the impact of the boycott movement in China?

A: It is difficult to determine whether the drop in sales in China is the result of a slowdown economy or a direct result of the boycotts, however in stores, the impact on compact digital camera sales has been severe and more recently, this is being passed on to digital SLR camera sales. Although we expect a drop in sales of digital cameras with interchangeable lenses in the vicinity of tens of thousands of units over the full year, we are planning to recover this primarily through the European market. The impact on the compact digital camera market will be more severe and as a result, we expect that it will impact on approximately 40% of a downward adjustment of 1 million units.

Q: What can you tell us about the non-reflex camera market and the Nikon 1 series?

A: Although varying from region to region, the non-reflex camera market is growing on average from 60 to 70% per year. In regards to the Nikon 1 advanced camera with interchangeable lenses, while difficult in the maturing domestic market, we are currently fighting for top market share in the European and US markets where the ratio of non-reflex cameras to digital cameras with interchangeable lenses is still low and there is potential for further growth. We are receiving strong support from our customers with global share reaching approximately 25%. Nikon will continue draw on the unique concept of the Nikon 1 series to provide appealing products and enhance our marketing activities.

Last month Canon had to cut their earnings outlook as a result of China's boycott.

Read more on the history of Chinese boycotts of Japanese products.

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  • rich

    so china can make their own canikon

    • MB

      Of course they can, they are the people that are actually making Nikon and Canon.

      • Sitti

        No They can’t. Designing their own camera from scratch is out of question. They can only make what Nikon and Canon tell them to make. Besides, all vital components are made in Japan. They only assemble in China. My D4 is made in Japan btw.

        • lilu

          please be reminded that the rare earth which is a key material for camra components is from China. i’m from China and i have to say today’s status is a loss-loss one, really bad.

          • Roger

            Couldn’t agree more, and things look as if not gonna retrieve soon here in mainland of China.

          • Sitti

            You need to keep yourself up to date with news. Exporting rare earth to Japan has dropped significantly since last time Chinese government disrupted supply to certain countries and especially Japan. Japan has already developed alternative technologies that require much less rare earth and NONE AT ALL for some components. They have also established new rear earth supply line with other “friendly” countries. Japan managed to secure more than 50% of rear earth supply that they need. As a result, rear earth export to Japan has dropped to less than half, and so is the price. Now, Chinese rear earth companies are losing large portion of revenue, since Japan is their biggest customer, and currently sustaining heavy loses. LOL They literally asked Japan to buy more from them. By the end of next year, rare earth export to Japan will be much smaller than today. Well, in my opinion, China got what they deserved for mixing business with politics. Japan, once they get serious, has shown to the world how much they can achieve with the power of technological advancement.

            According to recent news, Toyota and Pentagon are going to be working together to overcome Chinese rare earth monopoly.

            • Annonimouse photographer

              Please show me the recent news about that rare earth.

              As long if it is not from Fox news there might be some truth in it

            • Sitti
            • timon_comment

              China continuously got huge trade surplus with Japan, many years, but deficit was with S.Korea.

              for mixing business with politics, so huge trade surplus could continue in what a long time?

              finally, in Chinese civilians to be sad. They were abducted.

            • timon_comment

              N.Korea is a mirror to reflect China, especially yesterday of China,

              To go back 1960s and 1970s, Chinese copied Minolta SLR camera is too bad, the worst quality in mechanical and optical, but the civilians can not get to freely buy and optional, for the tattered copied camera to be planned economy with ticket to sell out.

              In early 1980s, China’s whole industrial technical level is so poor, whereafter, Japan and US and Europe offered much assistances. Otherwise, here to be still same as the N.Korea.

              In past 10 years, here is bad situation than another earlier 10 years, especially in last 5 years. With a worse supreme dictator 10 years.

        • timon_comment

          @ Sitti
          In Chinese market, there are some inferior brands of camera, but that also came from Taiwanese companies. OEM and then pastes an inferior brand with a dummy company.

          • Sitti

            Yes, but they are not exactly an alternative to Nikon and Canon. Especially DSLR. They can’t just copy decades long of experiences and researches and make their own version of camera body and lens with same performance and quality.

            • timon_comment

              Yes, you are right

  • Slow Gin

    You should expect appearance of new brand — Xin-Dong which will present a brilliant line of digital cameras and Xinkkor lenses.

  • http://twitter.com/tinotino tinotino

    Nikon is the worst offender. Let’s not forget the comfort women/Nikon gallery cancellation.

    • elleyy

      comfort women? Yes. Also think about how many American soldiers f’d up those innocent children during the Vietnam war in Vietnam and Laos. I went through seeing the horror. Pathetic when American did something bad and got sealed away. The level of severity is dam close or surpass to what the Japanese done. I wish video/photographer and media do some documentary on this.

      • Patriot

        What country are you from, please tell me more about how perfect your nation is.

        • elleyy

          Patroit read my post very carefully. I had never mentioned anything thing about a perfect nation.

  • Stup

    China is just plain stupid… greedy and clueless of the outside world thats why…

    • Roger

      Apparently you’ve never get to know China.

    • Sean

      lol. look who’s talking. somebody sounds like he lives in north korea.

      • Roger

        and sounds like you once lived in N.K. LOL.

        • Sean

          lol. nah man. it’s just very ironic that how a lot of people still think China is still that far behind and “clueless” of the “outside world”

          • Roger

            Sorry man, I posted the message to you mistakenly

    • Nic

      you have no clue what you are talking about. I’m not chinese but I live in China 7 years. Know before you speak

  • lilu

    look at Toyota, Mr. Nikon, you are much better

  • Nic

    I can confirm this. I live in China. I was about to buy the D800 when all of a sudden the problem with the islands started and the price immediately went much higher. About 3500usd, when normally it’d be around 3150 final depending where you buy it

    • timon_comment

      in Chinese civilians to be sad. They were abducted.

  • brian jones

    Admin, get rid of Disqus… The website is getting duller and duller everyday with the new comments section. Often times it doesn’t load, and there is just a few comments that are all rather bland… I miss the lively discussions from before. I know you had problems with spam, but this site has gone from one of my favorites to just one of many since the comments system has been implemented.

    • http://nikonrumors.com/ Nikon Rumors

      I guess I will have to post a poll – I cannot make everybody happy, but I can make the majority happy.

      • AlphaTed

        Nothing wrong with Disqus.
        What it got rid off aside from spam, are trolling, impersonating, and trash talking among other undesirables.
        It seems those who prefer Disqus gone were involved in such activities.

        • ben johnson

          i was never involved in any spamming. A little trolling is enjoyable every once in a while, especially on such a fanboy-centric forum. And what’s wrong with trashtalking, i didn’t do it, but it was fun. I just casually post when the discussion is lively. Yes, the discussion now is definitely, by far, and obviously more civil. It is also about as sterile as a hospital. Admin, I will continue to visit your site either way(and i sincerely thank you for your awesome site), but i do find the discussions to be much more dull since Disqus was introduced. What does SAR use(there comments are fun)? I miss the semi useless, but entertaining comments that were scattered about before…. sure, they may not have been that informative, but the casualness of the conversation was really enjoyable and refreshing.

          • http://nikonrumors.com/ Nikon Rumors

            I did a small change – you can now posts as a guest without registering with Disqus.

    • http://www.facebook.com/michaelleong.jin Michael Leong Qi Jin

      Disqus is way better. The old comment system is very annoying.

      • http://nikonrumors.com/ Nikon Rumors

        You can now post comments as a guest, you don’t have to be registered with Disqus – just like before. With this, I don’t see any reason to go back to the old system.

  • Lennart Bergman

    Lenses made in China ;)

  • polymer

    Sales of camera should be in the down for most DSLR, probably except Leica. To blame this purely on China boycott is a myth. Major DSLR producers are facing problem with EVIL, the cheaper, faster (depend how you define it, but for common user with only limited knowledge EVILs are slight faster and friendier to use). EVIL manufacturers could put out to the market with designs, features and advertisements while DSLR are mostly aim for semi and pros who choose camera because of its features like FX/DX, ISO, PIXELS etc and what lens they own. EVIL to me is fashionable products like clothes in Zara and H&M and it ultimately will hit DSLR makers such as Nikon, Canon, Pentas who their main stream is still really DSLR even though they also have EVIL.

  • Patriot

    What if America starts to boycott China? They wouldn’t really like it if we cut them off as a supplier now would they? I hope everything gets back to normal soon.

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