Japan's electronics sector in race against time
TOKYO — Japan's battered electronics giants are in a race against
time, analysts say, as losses that threaten their very survival mount
and as overseas rivals look like they are running away with the show.The latest earnings season has been ugly for the likes of Panasonic and Sharp, which say they will post an eye-watering combined annual loss of more than $15 billion, underlining fears about the sector's future.
Money-losing Sony offered a glimmer of hope by saying it was still on course to eke out an annual profit, after four years in the red.
However, Sharp nearly doubled its loss forecast to a record $5.6 billion -- and voiced doubt for the first time over whether it could remain a going concern -- just a day after Panasonic said it would lose $9.6 billion in the year to March.
The sector's myriad woes range from high labour costs at home and the strong yen to strategic blunders and a failure to keep up with rivals such as Apple and South Korea's Samsung in the lucrative smartphone and tablet market.
Japan's formerly world-beating brands are falling further behind while they continue making everything from phones and CD players to money-losing TVs and washing machines -- even as their key domestic market slows.
Among its missteps, the industry made huge investments in flat-screen televisions only to see prices plunge in an intensely competitive market, meaning razor-thin profit margins -- or none at all -- for firms that can ill afford them.
But they've largely resisted calls to abandon money-losing units, with longtime rivals Sony and Panasonic saying they are teaming up to make televisions.
"Japanese electronics firms need to sift through their businesses, taking what's good and leaving what's bad," said Masahiko Hashimoto, economist at Daiwa Institute of Research in Tokyo.
Slick marketing campaigns and locally-tailored products products offered by profitable automakers such as Toyota and Nissan are noticeably absent among many of the nation's once-mighty television giants.
"Japanese electronics makers had managed to get by through relying heavily on the domestic market so it's no wonder they've reached an impasse in line with that declining market," said Mitsushige Akino, an analyst at Ichiyoshi Investment Management in Tokyo.
"Before, they succeeded in selling things in developed nations by merely copying what they sold at home -- and they didn't take developing economies very seriously at first," he added.
The sector was slow to tap fast-growing emerging economies like the so-called BRICS nations -- Brazil, Russia, India, China and South Africa -- and has paid the price for their glacial strategy shift, Akino said.
Like many Japanese companies, electronics companies are hamstrung by high labour costs at home and the stubbornly strong yen, which makes their exports expensive and eats into repatriated profits.
A slowing global economy, last year's quake-tsunami disaster and weak demand in Europe -- a key market for Japanese exports -- are also unhelpful.
And this week the firms pointed to yet another unwanted problem: Tokyo's diplomatic spat with China over a disputed East China Sea island chain, which has seen a Chinese consumer boycott of Japan-brand goods.
Sharp, Sony and Panasonic have all announced massive corporate overhauls that include tens of thousands of job cuts to rescue their bleeding balance sheets, suffering credit downgrades and share price plunges in the process.
This summer, Sony's stock tumbled below 1,000 yen for the first time since 1980 and the era of the Walkman.
Panasonic said shareholders would not get dividend payments this year, the first time in decades.
Sharp, meanwhile, is putting up real estate -- including its Osaka headquarters -- as collateral for bank loans crucial to keeping the century-old firm alive.
This week, Sharp ominously warned there was "material doubt" about its ability to carry on as a viable company.
That warning was quickly followed by Fitch's six-notch credit rating downgrade that reduced Sharp's debt to junk status, warning they faced a severe cash-flow crisis.
"We think time is running out for the company," said Shunsuke Tsuchiya, analyst at Credit Suisse.
Once admired for their innovation, Japan's electronics sector must recalibrate with products that not only match rival offerings, but outdo them, analysts say.
"Japanese electronics makers used to have an outstanding advantage in terms of technology and that is their strength," said Keita Wakabayashi, analyst at Mito Securities in Tokyo. "But that advantage is running out."
People ride an escalator past a Panasonic advertisement in Tokyo.
STORY HIGHLIGHTS
- Panasonic and Sharp together forecast $15.2bn of net losses for the year
- Reckoning for past strategic mistakes, in the form of billions of investment write-offs
- Investments in flatscreen TVs and solar panels have proved to be disastrous
In earnings presentations
this week by Panasonic and Sharp, which together forecast $15.2bn of
net losses for the year, the profit-squeezing effects of the currency's
prolonged appreciation were barely mentioned. Instead, investors were
treated to a reckoning for past strategic mistakes, in the form of
billions of dollars in investment write-offs. "I am truly sorry," said
Takashi Okuda, Sharp's president since June.
For years, Japanese consumer electronics groups have been investing both too little and too much.
In the 1980s, when the
Japanese were beating up on formerly dominant US manufacturers,
Americans marvelled at how much money they devoted to research and
development and building newer, better factories, taking it as an object
lesson in the value of long-term thinking.
But now it is Japan that
is being outspent. Since 2000, South Korea's Samsung -- now the world's
biggest electronics company by sales -- has allocated an average of 12
per cent of sales to capital investment, about double the ratio at
Panasonic, Sony and Sharp.
When the Japanese have
invested, it has often been in the wrong areas -- products such as
flatscreen TVs and solar panels, which foreign rivals can make just as
well at less cost.
Sharp, a century-old
company that started out making mechanical pencils, is the most troubled
of Japan's big consumer electronics groups. The Y450bn ($5.6bn) net
loss it projected this week would be its second record deficit in two
years, and last year its ratio of net debt to earnings before interest,
taxes and other deductions more than doubled, from 1.7 times to 4.4
times.
On Friday Standard &
Poor's slashed its credit rating for Panasonic's long-term debt by two
levels, from A- to BBB, while Fitch downgraded Sharp's credit rating to
B-. Fitch said it "does not foresee any meaningful operational
turnaround in [Sharp's] core business over the short- to medium-term".
Sharp is trying to turn its focus from TVs and solar panels to small LCD displays for smartphones and tablet computers
Sharp was granted
temporary relief in September when it secured Y360bn in emergency loans
from its Japanese banks, which analysts say should give it sufficient
operating funds until at least next June, when the loans come due.
Negotiations with Hon Hai of Taiwan over a Y67bn investment, tentatively
agreed in March, have stalled, and the company is furiously trying to
free up cash on its own -- by cutting jobs and wages, selling overseas
factories and mortgaging offices in Japan.
None of this is a
long-term solution, however. Sharp is trying to turn its focus from TVs
and solar panels to small LCD displays for smartphones and tablet
computers, but even there it has experienced production delays and is
losing ground to rivals, says Toshihiro Uomoto, a credit analyst at
Nomura. "Sharp's problems go beyond just temporary funding issues, and
extend to doubts over the sustainability of its business."
At Panasonic, most of
this week's Y765bn net-loss forecast was owed to write-offs of tax
credits and past investments. Revenues are also falling, however: it cut
its annual sales forecast by 10 per cent, to Y7.3tn, and its projection
for operating profit by nearly half to Y140bn.
Takashi Watanabe, an
analyst at Goldman Sachs, says Japan's biggest consumer electronics
company has enough profitable businesses that eliminating or shrinking
the dud ones could turn it round.
Kazuhiro Tsuga,
Panasonic's new president, has declared that each division will be
judged on its own earnings power -- a change at what has long been a
collectively minded company. Sceptics, though, will note that the
company, which has 320,000 workers, has been through several big
restructurings before, without hitting on conclusive profit formula.
Sony bucked the trend
this week by sticking with its forecast for a narrow profit for the
financial year to March, in spite of a Y15bn net loss in the quarter to
September, blamed on restructuring costs.
Like Panasonic and
Sharp, Sony is shrinking its TV-making business, and says it will focus
on imaging technology, video games and smartphones, an area it has
strengthened since buying out Ericsson's share of their mobile phone
joint venture last year.
Shiro Mikoshiba, an
equities analyst at Nomura, says the smartphone push looks promising on
its own, but could be risky for a company that makes digital cameras,
game consoles, portable music players and notebook computers -- all
products that multipurpose smartphones are increasingly replacing.
"We see a strong possibility of a vicious cycle in the company's product strategy," Mr Mikoshiba says.
What's Killing Japanese Electronics?
Hardly a day goes by without bad news for the Japanese electronics industry. With a few notable exceptions, such as Canon, the titans of the industry are projected to hemorrhage $17 billion in the current fiscal year. S&P has lowered its credit rating on Sony and Sharp to BBB+, just two notches above junk status.
Electronics executives are quick to blame the strong yen. But that is a self-serving excuse. The recent high nominal value of the yen doesn't explain why Sony lost money on TVs for the past eight years in a row岸including when the yen was weak. Nor why the firms which gave us the transistor radio, the Walkman, the CD and the VCR seem to have run out of ideas.
The plunge in the past decade is nothing short of breathtaking. From 2000-2010, Japan's electronics production plummeted 41%, exports tumbled 27%, and the sectoral trade surplus dived 68%. Counting only exports by high-income OECD countries (to avoid the impact of China), Japan's global market share of electronics goods and services exports fell by nearly half, to 10% in 2009, from 19% in 1996. In the same period, Germany's share rose to 11% from 8% and Korea's rose to 9.2% from 6%.
The immediate cause of the problem is bad product strategy. Japanese firms and the government failed to heed two big lessons taught by Harvard Prof. Michael Porter. First, as countries mature, their sources of competitive advantage change. At one point, abundant skilled labor, cheap capital and price are keys to competitiveness. Later on, innovation in products and processes becomes pivotal. Secondly, strategy is not just about what products to offer, it's also about what products not to offer.
Rejecting these lessons, Japanese firms tried to compete with newcomers like Samsung on cheap capital and manufacturing prowess instead of product innovation. They kept producing formerly world-beating products that now lose money year after year. Forty percent of Japan's electronics output still consists of consumer audio-video products and semiconductors.
Moreover, when firms or products failed, Japan's answer was mergers, sometimes aided by government money. The theory was that putting three losers together would turn them into one winner due to economies of scale. Elpida, Japan's largest maker of DRAM chips before it filed for bankruptcy last month, was the epitome of this failed concept. It was formed out of the DRAM divisions of Hitachi, NEC and (later) Mitsubishi.
Failure to exit from the market for commoditized chips caused the Japanese market share among the world's top 20 semiconductor producers to shrink to 24% in 2010 from 55% in 1990. Japanese often blame Samsung, but the real news is that the U.S. share rose to 51% from 31% over the same period because firms like Intel and Texas Instruments abandoned commoditized products where price is key in order to concentrate on must-have products that set the standard.
Seventy-seven percent of Japan's entire electronics output now consists of parts and components that often go into other firms' products. Yet a cost breakdown of Apple's iPod or iPad or Samsung's Android smartphone shows that the real money does not go to the parts producers but to the product inventors. Japanese firms are competing against Samsung when they should be competing against Apple, Intel and Microsoft.
Skills and mindsets that enabled Japan to create one revolutionary product after another in the audio-video era have failed in the digital era. Whether it's PCs, smartphones or software, Japanese firms no longer lead the way.
Part of the reason lies in the nature of the corporate system in Japan. Daniel Kahneman, a psychologist who won the Nobel Prize in economics, explains why some firms spend money keeping bad programs on life support, leaving insufficient capital for new ones. Firms in all countries often act like losing gamblers, Mr. Kahneman argues, who won't leave the table until they have made up their losses. And the executive in charge gets to delay the loss from showing up until he has moved on.
This is where the difference between American and Japanese corporate structures has big consequences. In the U.S., emerging technologies are usually championed by new firms that have no financial or emotional stake in the old technology. Most of the firms that led in the era of TVs or midrange computers no longer even exist. Among the top 21 electronics manufacturers in the U.S. today, eight did not exist in 1970 and six were too small to be in the Fortune 500 a decade ago
In Japan, there has been no new entrant into the top ranks of electronics manufacturing for more than half a century. When a new technology arises, firms like Panasonic, Sony, Sharp, Fujitsu or NEC create a new division. So the firm waffles between the past and the future, slowing creative destruction.
In certain industries, like autos, the Japanese approach may prove superior, but not in the rapidly changing world of digital electronics. Take a look at how many young Japanese flock to the Apple stores in Tokyo and how few linger in the Sony stores.
Electronics executives are quick to blame the strong yen. But that is a self-serving excuse. The recent high nominal value of the yen doesn't explain why Sony lost money on TVs for the past eight years in a row岸including when the yen was weak. Nor why the firms which gave us the transistor radio, the Walkman, the CD and the VCR seem to have run out of ideas.
The plunge in the past decade is nothing short of breathtaking. From 2000-2010, Japan's electronics production plummeted 41%, exports tumbled 27%, and the sectoral trade surplus dived 68%. Counting only exports by high-income OECD countries (to avoid the impact of China), Japan's global market share of electronics goods and services exports fell by nearly half, to 10% in 2009, from 19% in 1996. In the same period, Germany's share rose to 11% from 8% and Korea's rose to 9.2% from 6%.
The immediate cause of the problem is bad product strategy. Japanese firms and the government failed to heed two big lessons taught by Harvard Prof. Michael Porter. First, as countries mature, their sources of competitive advantage change. At one point, abundant skilled labor, cheap capital and price are keys to competitiveness. Later on, innovation in products and processes becomes pivotal. Secondly, strategy is not just about what products to offer, it's also about what products not to offer.
Rejecting these lessons, Japanese firms tried to compete with newcomers like Samsung on cheap capital and manufacturing prowess instead of product innovation. They kept producing formerly world-beating products that now lose money year after year. Forty percent of Japan's electronics output still consists of consumer audio-video products and semiconductors.
Moreover, when firms or products failed, Japan's answer was mergers, sometimes aided by government money. The theory was that putting three losers together would turn them into one winner due to economies of scale. Elpida, Japan's largest maker of DRAM chips before it filed for bankruptcy last month, was the epitome of this failed concept. It was formed out of the DRAM divisions of Hitachi, NEC and (later) Mitsubishi.
Failure to exit from the market for commoditized chips caused the Japanese market share among the world's top 20 semiconductor producers to shrink to 24% in 2010 from 55% in 1990. Japanese often blame Samsung, but the real news is that the U.S. share rose to 51% from 31% over the same period because firms like Intel and Texas Instruments abandoned commoditized products where price is key in order to concentrate on must-have products that set the standard.
Seventy-seven percent of Japan's entire electronics output now consists of parts and components that often go into other firms' products. Yet a cost breakdown of Apple's iPod or iPad or Samsung's Android smartphone shows that the real money does not go to the parts producers but to the product inventors. Japanese firms are competing against Samsung when they should be competing against Apple, Intel and Microsoft.
Skills and mindsets that enabled Japan to create one revolutionary product after another in the audio-video era have failed in the digital era. Whether it's PCs, smartphones or software, Japanese firms no longer lead the way.
Part of the reason lies in the nature of the corporate system in Japan. Daniel Kahneman, a psychologist who won the Nobel Prize in economics, explains why some firms spend money keeping bad programs on life support, leaving insufficient capital for new ones. Firms in all countries often act like losing gamblers, Mr. Kahneman argues, who won't leave the table until they have made up their losses. And the executive in charge gets to delay the loss from showing up until he has moved on.
This is where the difference between American and Japanese corporate structures has big consequences. In the U.S., emerging technologies are usually championed by new firms that have no financial or emotional stake in the old technology. Most of the firms that led in the era of TVs or midrange computers no longer even exist. Among the top 21 electronics manufacturers in the U.S. today, eight did not exist in 1970 and six were too small to be in the Fortune 500 a decade ago
In Japan, there has been no new entrant into the top ranks of electronics manufacturing for more than half a century. When a new technology arises, firms like Panasonic, Sony, Sharp, Fujitsu or NEC create a new division. So the firm waffles between the past and the future, slowing creative destruction.
In certain industries, like autos, the Japanese approach may prove superior, but not in the rapidly changing world of digital electronics. Take a look at how many young Japanese flock to the Apple stores in Tokyo and how few linger in the Sony stores.
Richard Katz
日
本的電子產業幾乎天天都有壞消息。除了佳能（Canon）這樣的少數特例之外，業內其他巨頭在本財政年度的虧損預計會達到170億美元。標普（S&P）已經將索尼（Sony）和夏普（Sharp）的信用評級降至BBB+，僅比垃圾級別高兩級。
Agence France-Presse/Getty Images
1979年，索尼第一款Walkman隨身聽上市。
日本電子產業過去10年的大幅衰退著實讓人震驚。從2000年到2010年，日本電子行業的產量銳減了47%，出口下跌了27%，行業貿易順差陡降了68%。單單統計高收入的經合組織（OCED）國家的出口數據（這樣可以避免計入中國的影響），日本電子產品及服務出口的全球市場份額從1996年的19%下降到2009年的10%，折損近半。而在此期間，德國的市場份額從8%上升到11%，韓國則從6%增長到9.2%。
問題的直接原因在於錯誤的產品策略。日本政府和企業對哈佛大學教授邁克爾•波特（Michael Porter）傳授的兩大要義都未予以重視。第一，隨著各國的成熟，它們的競爭優勢資源也會發生改變。充足的熟練工人、廉價的資本與價格一度是競爭力的關鍵，到後來產品和工藝的創新成為了競爭力的核心。第二，產品策略不僅僅指企業能提供什麼樣的產品，它也包括企業不提供什麼樣的產品。
日本企業將這些要義棄之一旁，試圖在廉價資本和制造技術方面而非通過產品創新與三星（Samsung）這樣的新貴進行比拼。他們繼續制造著過去領先世界如今卻連年虧損的產品。日本生產的電子產品中仍有40%是消費類視聽產品和半導體產品。
此外，當公司或產品經營失敗時，日本解決問題的辦法是合並重組，有時還會得到政府資金的扶持。其理論依據是規模經濟可以使綁在一起的三個輸家變成一個贏家。爾必達（Elpida）公司就是這種失策想法的一個縮影。2月份提出破產申請之前，爾必達是日本最大的動態隨機存取存儲器（DRAM）芯片制造商，它是由日立（Hitachi）、日本電氣（NEC）和（後來的）三菱（Mitsubishi）三家公司的DRAM事業部合並而成。
由於沒有從商品化芯片市場中退出，在世界半導體制造商20強中，日本的市場份額從1990年的55%萎縮到2010年的24%。日本人常常將責任歸咎於三星，但真實的情況是美國在同一時期的市場份額從31%升至了51%，因為英特爾（Intel）和德州儀器（Texas Instruments）這樣的企業為了集中力量開發能設立行業標準的必備品而放棄了以價格為關鍵要素的商品化產品。
日本生產的全部電子產品中，77%是零部件，這些零部件常常被組裝到其它公司產品中。然而，對蘋果公司（Apple）的iPod、iPad和三星公司的安卓（Android）智能手機進行的成本分析表明，真正賺錢的不是零部件生產商，而是產品的研發者。日本企業在本該與蘋果、英特爾和微軟（Microsoft）公司博弈的時候卻在與三星競爭。
視聽產品時代讓日本創造一個又一個革命性產品的理念和技能在數字時代不再靈驗。無論在個人電腦、智能手機還是軟件領域，日本企業都不再是龍頭老大。
部分原因在於日本企業制度的特性。諾貝爾經濟學獎得主、心理學家丹尼爾•卡內曼（Daniel Kahneman）解釋了為什麼有些企業花錢執行糟糕的保命計劃，致使新項目開發的資金不足。他說，在所有的國家，企業的行為經常像一名輸了錢的賭徒，不把錢贏回來就不離開賭桌。而企業高管直到自己走人的時候才會讓企業的虧損浮出水面。
美國企業和日本企業在公司結構上存在差異，正是這種差異產生了巨大的影響。在美國，新興技術的桂冠往往都是被新建企業摘取，它們在經濟上和情感上都與老舊技術沒有瓜葛。大部分引領電視或中型計算機時代的企業甚至已經不復存在。如今的美國電子產品制造商前21強中，有八家在1970年時尚不存在，還有六家在十年前規模很小，上不了《財富》（Fortune）500強排行榜。
在日本，半個多世紀的時間裡沒有一家新企業進入最大電子產品制造商行列。每當新技術出現的時候，鬆下（Panasonic）、索尼、夏普、富士通（Fujitsu）或日本電氣公司這些企業就會成立新的部門，因此公司就在過去和未來之間徘徊猶豫，放慢了創造性破壞的步伐。
在某些產業領域，比如汽車，日本的做法可能被証明十分優越，但是在日新月異的數字電子技術世界並非如此。看看吧，有多少日本年輕人蜂擁至東京的蘋果專賣店，而索尼商店則鮮有人問津。
附三則英日文關於日本技術的報導：兩則與Toyota公司相關。
我昨天讀Toyota公司的人向日本年輕人介紹車子的電子化比率日益高，所以就職機會多。 其實，這種趨勢，在20幾年前圈內人都知道了。然而，重點是如何落實成業績。
同樣，日本政府保護有原創性的機械，這在美國領先近一甲子（？）。不過Toyota等公司都有自己的博物館。
同樣有意思的是，Toyota公司以後來者介入日本「海上交通器（豪華遊艇等）」市場，最值得觀察。
「適職フェア」特別講演…クルマは電子機器に
2007年7月30日
日経HRと日経BP社は29日、東京国際フォーラムにて『自動車同フォーラムは、電気/電子/半導体/機械系エンジニア向けの
特別講演としてトヨタ自動車BR制御ソフトウェア開発室の担当者に
現在、トヨタの場合、クルマ1台あたりで、電子部品は全部品のおよ
よって、トヨタとしてもエレクトロニクス系の技術者
《デイビー日高》
VDIM（Vehicle Dynamics Integrated Manegement）とは、トヨタ自動車が独自に開発した、統合車両姿勢安定制御システムである。
VDIM システムの概要
横滑り安定装置のVSC、アンチロック・ブレーキ・システム anti-lock brake のABS、電動パワーステアリング power steeringなどを電気的に接続し、いざという時に危険回避性能をより高めたものである。Craftsmanship and 'kaizen' efficiency combine in Toyota's sea quest
08/03/2007
BY KAZUO TERANISHI, THE ASAHI SHIMBUNISE, Mie Prefecture--While Toyota Motor Corp. sets its sights on becoming the No. 1 automaker on every shore, the giant is taking its quest for market domination to a different turf--the waters of Japan.
 Toyota Motor Corp.'s Ponam-45 luxury pleasure boat is built at New Japan Marine Co.'s factory in Ise, Mie Prefecture. (THE ASAHI SHIMBUN) |
Toyota's flagship model, the Ponam-45, a 15-meter boat dubbed the Lexus of the Sea, sells for about 94 million yen.
In 2006, Toyota ranked third in the domestic market for midsize and large pleasure boats, with a 15-percent share.
Yamaha Motor Co. controlled 50 percent of the market, followed by Yanmar Marine System Co.'s 28-percent share.
The Ponam-45 received 13 orders within several months after its release in October 2005, a pleasant surprise for the company, which had projected only five sales for the entire year.
Demand was so overwhelming that the company was forced to stop taking orders for about 13 months through March.
Toyota plans to improve the manufacturing process so that it can double annual production to 10 units from 2008.
The company consigns boat production to shipbuilders, and the Ponam-45 is produced by New Japan Marine Co., based in Ise, Mie Prefecture.
Unlike state-of-the-art automobile factories, shipbuilding is more of a craftsmen's work; 80 percent of the Ponam-45's building process is done by hand.
"(Our workers) valued traditional craftsmanship and were totally not used to an efficiency-oriented approach," New Japan Marine President Kazuhiko Nakakita said.
Toyota is slowly transforming the shipbuilder's operation into one using the automaker's efficient production methods.
Taking the lead is Koichi Iwamoto, who became general manager of Toyota's Marine Business Division in January.
A veteran in autoparts procurement, the 53-year-old had introduced Toyota's kaizen, or continuous improvement, activities to suppliers.
At the end of 2006, Toyota started monthly study meetings among New Japan Marine and subcontractors involved in the Ponam-45. It also stationed an engineer at the shipbuilder's yards.
At New Japan Marine, about 300 improvements have been made at Toyota's behest.
For example, a modular assembly line for the cabin's furniture has helped to reduce production time.
Previously, craftsmen put together furniture parts inside the already completed cabin. Now, furniture is assembled in a corner of the factory while the cabin is built.
In another example, screws for one boat were put in a single cart, allowing workers to easily find them.
"We are still working on the basics, and it is too early to say that we have incorporated Toyota's production methods," Iwamoto said.
Toyota started considering the feasibility of entering the pleasure boat business in 1990 at the suggestion of Shoichiro Toyoda, the eldest son of company founder Kiichiro Toyoda.
"We want to be engaged in transportation equipment for land, sea and air. It is better to have a Toyota product that can travel the sea that surrounds Japan," a company source quoted Toyoda as saying.
The company entered the market in February 1997 with a midsize boat, about 10 meters in length. Its lineup later expanded to include large and small boats.
Toyota decided to concentrate on midsize and large boats, which carry fat profit margins, after their small boats posted sluggish sales.
After the nation's asset-inflated economy collapsed in the early 1990s, many players pulled out of the industry, leaving Toyota relatively free of rivals when it entered.
The value of the domestic luxury boat market reached 13.2 billion yen in 2006, topping the 10-billion-yen mark for the first time in five years.
While the number of units shipped continued to decline, the market value rose thanks to strong sales of expensive midsize and large boats.
But with the market's expansion comes growing competition.
Both Yanmar and Nissan Motor Co. have introduced new luxury boats since last year.
Yamaha is trying to attract wealthy customers by holding joint exhibitions with dealers who import luxury cars, such as Ferraris.
A Yamaha official said the wealthy are increasingly spending their money and time on recreational activities, including boating.
Yamaha said a growing number of young people, such as the owners of information technology companies, are buying large luxury boats.
In 2006, the average age of buyers of luxury boats in urban areas was 46, down from 63 in 2003, according to the company.
Yamaha, which has a broad product range, also aims to expand its customer base by increasing the variety of low-end rental boats at its marinas.(IHT/Asahi: August 3,2007)
Certification program to preserve historic machines
08/03/2007
By TAIRIKU KUROSAWA, THE ASAHI SHIMBUN
A certification system has been established to preserve machinery and technology-related items with historical value, such as Japan's first-generation bullet train.
The Japan Society of Mechanical Engineering, which groups university professors and corporate engineers, plans to list 100 items under its Mechanical Engineering Heritage program over the next 10 years.
The first 25 items, which include the 0 series Shinkansen and the YS-11 turbo-prop aircraft, will be formally recognized on Tuesday.
If the companies or individuals who hold the rights to the the certified items can no longer take care of them, the society will step in to prevent them from being lost or disappearing altogether. In such cases, the society will ask the National Museum of Nature and Science in Tokyo or local governments to take over the items.
The 25 items include Honda Motor Co.'s Cub-F type auxiliary engine designed for bicycles and Komatsu Ltd.'s G40 bulldozer, the first bulldozer produced in Japan.
Ichiro Tsutsumi, who chairs the society's heritage selection committee, said people must learn from history to create something new.
"The machines symbolize the technologies of the times," he said. "They reflect not only the designers' way of thinking but also (government) policies and society."
The Mechanical Engineering Heritage program was established to commemorate the society's 110th anniversary.
The list will include machines that have left important marks on the history of technological development or contributed to society, the economy, culture and lifestyles.
Machinery-related systems, machine-production plants, design specifications and textbooks are also eligible for certification.
Mazda Motor Corp.'s rotary engine, the automatic loom invented by Sakichi Toyoda, founder of Toyota Industries Corp., and a 1905 lecture note on hydrodynamic study at the predecessor of the University of Tokyo will be among the first 25 items certified.
Komatsu's G40 bulldozer was produced during World War II at the government's request for construction of airports and other facilities.
The certified bulldozer was used in the Philippines and abandoned in the sea by the U.S. forces after the war ended.
The machine was salvaged and later used at an Australian farm. It was returned to Japan in 1978.(IHT/Asahi: August 3,2007)
A certification system has been established to preserve machinery and technology-related items with historical value, such as Japan's first-generation bullet train.
The Japan Society of Mechanical Engineering, which groups university professors and corporate engineers, plans to list 100 items under its Mechanical Engineering Heritage program over the next 10 years.
The first 25 items, which include the 0 series Shinkansen and the YS-11 turbo-prop aircraft, will be formally recognized on Tuesday.
If the companies or individuals who hold the rights to the the certified items can no longer take care of them, the society will step in to prevent them from being lost or disappearing altogether. In such cases, the society will ask the National Museum of Nature and Science in Tokyo or local governments to take over the items.
The 25 items include Honda Motor Co.'s Cub-F type auxiliary engine designed for bicycles and Komatsu Ltd.'s G40 bulldozer, the first bulldozer produced in Japan.
Ichiro Tsutsumi, who chairs the society's heritage selection committee, said people must learn from history to create something new.
"The machines symbolize the technologies of the times," he said. "They reflect not only the designers' way of thinking but also (government) policies and society."
The Mechanical Engineering Heritage program was established to commemorate the society's 110th anniversary.
The list will include machines that have left important marks on the history of technological development or contributed to society, the economy, culture and lifestyles.
Machinery-related systems, machine-production plants, design specifications and textbooks are also eligible for certification.
Mazda Motor Corp.'s rotary engine, the automatic loom invented by Sakichi Toyoda, founder of Toyota Industries Corp., and a 1905 lecture note on hydrodynamic study at the predecessor of the University of Tokyo will be among the first 25 items certified.
Komatsu's G40 bulldozer was produced during World War II at the government's request for construction of airports and other facilities.
The certified bulldozer was used in the Philippines and abandoned in the sea by the U.S. forces after the war ended.
The machine was salvaged and later used at an Australian farm. It was returned to Japan in 1978.(IHT/Asahi: August 3,2007)
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