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Camera makers impacted by Japanese disaster

March 16, 2011: Japanese manufacturers of photographic equipment with factories located in areas affected by the earthquake, tsunami and now dangerously malfunctioning nuclear power plants will encounter supply challenges for up to six months, according to a leading photo retailing executive.

LEFT: US Geological Survey map from today, March 16, showing earthquakes in Japan in the last week (in yellow) and the last day (blue). In all, over 500 separate quakes have been detected.

‘…this will be an ongoing issue for at least six months and the industry needs to plan for disruption to supply and alter business plans and marketing plans accordingly.’
– Nic Peasley, Ted’s Cameras

While some camera makers have been directly impacted to varying degrees, others have temporarily ceased or scaled down operations to assist in overcoming electricity shortages.

Canon, Fujifilm, Nikon, Olympus, Panasonic, Seiko Epson, Sigma and Sony are among the companies with factories that are likely to be affected by last Friday’s earthquake and its aftermath.

Canon has issued a statement saying the Canon Inc headquarters and the Canon subsidiary locations in Japan did not suffer major damage to any buildings or factories, although approximately 12 employees at Canon’s Utsunomiya factory suffered minor injuries and in some Canon manufacturing sites production was suspended as a result of power failures.

Fujifilm has confirmed that its Taiwa-Cho factory, just 32 kilometres from Sendai city, has been affected, although no staff are reported as injured. Damage to the factory building has caused a temporary halt in production of the FinePix X100, which is made at this plant.

Nikon’s Sendai factory, which manufactures the company’s flagship DSLRs, has suffered damage to some part of the equipment and buildings and production has been temporarily suspended. Some employees have been injured. A company statement can be found here.

Olympus has confirmed that the earthquake has not affected its production lines.

A few employees at Panasonic’s Lumix camera factory in Fukushima have been injured, according to a company statement. Several employees at its three factories in Miyagi and Fukushima prefectures sustained minor injuries. The company is currently assessing the impact on the business operations.

Pentax has yet to issue a statement but recent reports suggest their factories have not suffered major damage.

According to the Bloomberg news agency, Sony said in a statement on Monday that while only its Sendai Technology Center sustained earthquake damage, it has halted production and evacuated six factories in north-eastern Japan involved in manufacturing Blu-ray discs, magnetic heads and batteries. The company is assessing the impact of power outages and damage to its facilities in the region.

‘Sony also has responded to reports of widespread power outages by voluntarily suspending operations at several sites. No significant injuries have been reported to employees working at any of these sites when the earthquake or tsunami occurred,’ Sony said on its website.

‘The company is currently evaluating the full impact of the earthquake, tsunami and related power outages on Sony’s businesses and consolidated financial results.’

Seiko Epson has reported no casualties ‘at this stage’ but has suspended operations at four facilities. Epson Atmix Corporation (Hachinohe, Aomori Prefecture) was hit by a one metre tsunami, while Epson Toyocom Corporation Fukushima Plant has suspended operations temporarily as the plant is within the evacuation area associated with the Tokyo Electric Power Company’s Fukushima No. 1 nuclear power station. Damage to other facilities has been ‘minimal’, but production has been suspended because of power cuts caused by the earthquake.

The Sigma COO is reported as having tweeted that there was damage to machines and facilities at the company’s Fukushima Aizu factory, but no injuries or casualties. Production is expected to re-start within a week given that the threat posed by the Fukushima nuclear plant retreats.

Retailers uncertain

Peterr Michael, Michaels CVD, said that so far there hadn’t been any significant briefings from camera companies regarding supply, ‘but it may be difficult for them right now.’

He said in the absence of direct information, a close watch of the various company’s share prices would give an indication of the extent to which they were impacted, and the knock-on effect to the supply chain.

He anticipated that there would be an increase in backorders, ‘but the degree is anyone’s guess’.

Michaels put in orders for extra stock on Monday this week and anticipated that this would carry the business through for up to four weeks.

He noted that following the Kobe earthquake, it was anticipated that recovery would take 10 years, but in fact within 15 months they were 98 percent recovered.

‘They are quite amazing people,’ he said. ‘Very focussed.’

Nic Peasley, general manager, Ted’s Cameras, was also uncertain about the local situation:

‘We are unsure as to the status of supply at this stage, as are the suppliers, but we are making plans now to avoid shortages in our stores in the coming months,’ he said.

‘We are running our usual stock levels at present but as stated we are looking to ensure a position of stock continuity for our customers and working closely with the major manufacturers to achieve this.

‘I think that this will be an ongoing issue for at least six months and the industry needs to plan for disruption to supply and alter business plans and marketing plans accordingly.

‘More importantly, we all hope that further tragedy is avoided and the Japanese people can rebuild to normal life as quickly as possible.’

Paper supplies are perhaps not as severely effected as equipment, with Fujifilm manfacturing in other countries and Stuart Holmes, managing director, IPS, confident that the company has good supplies of DNP product.

‘As devastating and sad as they general news our of Japan is, the good news is that all of our paper and chemistry supplies are secure, he said.

‘We have significant DNP shipments already in our warehouse, and “on the water” and have just confirmed that we have another shipment leaving Tokyo Bay today (March 16), so no problems at all.

‘As you may be aware our CPAC Chemistry comes from Thailand.’

Camera House management did not respond to Photo Counter’s enquiries.

– with assistance from Margaret Brown, Photo Review

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