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Canon CEO Signals Major Shift:
Outsourcing Printer Production Amid Declining Demand.
Canon’s president, Fujio Mitarai, has unveiled significant plans that could reshape the company’s production strategy, as revealed in an interview with Nikkei Asia on January 10. The 89-year-old executive shared insights that could signal a major shift in Canon’s approach to manufacturing, particularly concerning its lower-market segment printers and digital cameras.Mitarai stated that Canon intends to outsource the production of certain printer and camera models, driven by ongoing declines in demand and corresponding drops in sales. Although no concrete timeline for these changes has been provided, it marks a pivotal moment for the company’s future strategy.
Currently, Canon handles all aspects of its printer production in-house, with the bulk of its manufacturing taking place in Vietnam since 2002, alongside smaller operations in Thailand and Japan. However, Mitarai’s announcement indicates that the company plans to adopt a “fabless” model for certain product lines, particularly targeting more budget-friendly printers and cameras.
In practical terms, this means Canon will focus its efforts on developing key components domestically in Japan, while outsourcing the final assembly of its devices to third-party manufacturers in Southeast Asia. While Mitarai did not provide specific product details, the shift likely impacts both inkjet and laser printers, including those Canon produces for HP, the global market leader in printing.
Canon’s decision comes as its printer and camera divisions continue to face sharp declines in sales. According to industry research from IDC, Canon’s printer shipments, which remained steady at over 20 million units annually until 2018, are expected to fall to around 16.5 million units by 2024. Although this number is still preliminary, the trend reflects an ongoing contraction in the market.
Looking ahead, Canon aims to refocus its efforts on the more lucrative business-to-business (B2B) market, where customers tend to offer higher added value. Additionally, Canon is placing increasing emphasis on the medical sector, with its “Canon Medical Systems” division, acquired from Toshiba in 2016, seen as a critical growth area for the company.
With these strategic changes, Canon is positioning itself to navigate a challenging market landscape while seeking growth opportunities in new sectors. As the company looks to streamline production and enhance focus on high-value sectors, the coming years could prove pivotal in determining Canon’s long-term success.
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