This Week in Imaging: China Slowdown, Tariffs, Cited for Lower Revenues
This week saw a mixed bag of financial results from Japan-based office-imaging companies, with revenues down for most for Japan’s traditional nine-month reporting period.
Most cited a stronger Japanese yen, which now stands at 1 yen for $0.0091, versus a low, for instance, of 1 yen for $0.0089 in March 2019. Most also cited the effects of U.S. tariffs imposed on products made in China and imported into the United States.
Third, and likely the most critical, was the general slowdown of the Chinese economy, a key market for printer/copier markets. In 2007, China hit a record high of 14.7 percent economic growth, but has been slowing ever since. The Chinese government has forecast more modest growth of 6.7 percent for 2019
However, that’s likely to be lower with the onset of the deadly Coronavirus that originated in the Wuhan, China. Aside from the human toll, the crisis means office-imaging companies – including not only Japanese companies, but HP Inc., Xerox, and Lexmark – are all vulnerable to disruptions in their supply chains for manufacturing printers, MFP/copiers, and their supplies, as well as disruptions to their sales in China. For now, Konica Minolta and Ricoh are delaying re-opening many of their sales and manufacturing in China until February 10th – these operations were first closed in observance of the Chinese New Year holiday that began on January 25th.
How much this crisis will affect the office-imaging companies remains to be seen, but economists already predicting a 1-percent slowdown in China’s economy for its January to March first quarter.
This Week in Imaging
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