Weak Yen Drives Japan Electronics Production Back Home

Electronics giants Canon Inc and Sharp are planning to bring production back to Japan due to a drastic decline in the value of the yen which makes local goods more competitive.

As was reported by Reuters, the yen has dropped around 8 percent since the Bank of Japan last eased monetary policy in October. Currently the yen is trading near seven-year lows. With the sharp depreciation, the costs increased for companies heavily dependent on raw material imports and those that manufacture abroad.

Now, Canon expects domestic production to go up from around 40 percent to 60 percent of overall output in three years. Hirotomo Fujimori, a spokesman for the company, revealed, “From now on, new copier, camera and printer products will be built at domestic factories and as they replace older products, the volume of goods made overseas will fall.”

Also, Sharp is planning to increase the production of LCD televisions and refrigerators made in Japan while Panasonic has been considering improving domestic production.

Panasonic CEO Kazuhiro Tsuga said at the Consumer Electronics Show, “Most white goods sold in Japan are imported from China so it’s natural we could see more goods manufactured in Japan on the back of a weaker yen.” “But it’s more of a passive rather than a proactive shift,” he added.

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