Strong YEN and natural disaster caused huge losses to Japanese Firms
Most of the japanese electronic firms are facing losses.As bloomberg reports this loss can be around $117 bn in total for japanese electronics manufacturing companies.Well known company Panasonic has forecasted a 780 billion yen loss while Sony predicted its loss to be 220 bn YEN in the year ending this March .Japanese domestic demand is very limited and is contracting day by day,their are very few opportunities left for companies to expand here.Consumption is lacklustre and companies are facing it quite difficult to expand inside the country.
Reasons :
1) Strong competition : Besides local competitors, companies have to also face tough competition from strong global competitors like Samsung,Apple.
2)Strong YEN : Yen has climbed to post world war II high ,due to this increase in value of YEN exporters are facing problem.Their goods are now loosing their edge over prices to their competitors.
3)Natural Disaster Flood : In march 2011 natural disasters earthquake and tsunami hit factories and disrupted supply chains, of many crucial parts just after it fear of radiation from FUKUshima hurt exports industry.Thailand’s worst floods in 70 years shut factories making cameras and hard-disk drives, disrupting production and causing shortages during the holiday shopping season.