Japan Electronics Emulates Detroit Autos Before Bankruptcy

In 2004, Kameyama, a town of 50,000 people in central Japan, boomed when Sharp started making liquid-crystal-display panels there.

Sharp dominated the industry with a 22 percent market share in LCD TVs and poured $6.6 billion into Kameyama, creating two state-of-the-art factories and 3,000 jobs. Farmland was turned into housing as workers in their 20s moved in from as far away as Brazil. Taxes from Sharp paid for the renovation of the train station and a new school with features like a castle.

Then Samsung Electronics began driving down prices, forcing Sharp to keep pace. Prices for 40-inch LCD panels fell from about $2,700 in the beginning of 2004 to $1,300 in 2005 and kept dropping until they reached $250 at the start of this year. Samsung steadily gained market share, moving to 29 percent in 2012 from 10 percent in 2004.

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Japans Electronics Industry is Bleeding Heavy As Companies Post Huge Losses

Can Japan afford for its legendary electronics companies to lose?  Alarmingly, this unthinkable thought is becoming thinkable.  The real question now is whether such a disaster is inevitable.

In the year ending March 31, 2012 Sony NYSE:SNE is expecting to lose JPY 220 billion USD 2.9 billion  .    This follows losses in the FY 2011 of JPY 260 billion USD 3.2 billion. Panasonic NYSE: PC will lose JPY 780 billion USD  10.3 billion following a loss of JPY 74 billion in the previous year. Sharp SHCAY.PK is expecting to lose JPY 290 billion USD 3.8 billion for the year.

The carnage extends to business apparatus and electric parts makers.  NEC NIPNY.PK is expecting to lose some JPY 100 billion.

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Japan’s Tech Companies Face Weak TV Demand

Japan’s top consumer electronic firms recovered faster than expected from March’s earthquake, allowing most of them to maintain full-year profit forecasts despite a weakening TV market and concerns about the outlook for the global economy.

Video game maker Nintendo was a standout disappointment as it unexpectedly swung to a quarterly operating loss, hit by sluggish sales of its 3DS handheld game player and a strong yen. It also slashed its full-year forecast to far below market expectations. 

Sony and Panasonic warned of weak TV sales, following Philips and Corning [GLW  16.00    -0.04  (-0.25%)] in highlighting sluggish demand. 

Global consumer confidence fell in the second quarter to its lowest level in 18 months as an uncertain economic outlook, a deepening euro zone debt crisis and rising inflation made people cautious, a Nielsen survey showed.

Read the rest of the story: Japan’s Tech Companies Face Weak TV Demand, Keep Forecasts.