|News Regarding Nikon’s Lens Production|
Nikon’s decision to shift its lens manufacturing factories to Thailand was not done overnight. The company made no bones about wanting to concentrate on its home country – until recently. Today, however, with tourism and the fragile economic state of Thailand becoming more acute, it’s clear that the benefits of having a plant there are more than financial. Let’s take a closer look at the four key reasons why:
- It Offers Better Equipment Quality – In terms of lens manufacturing, some of the best equipment is made in Japan. The quality issue is nothing new. The difference here though is that the technology is being used on a more mass scale.
- It’s Better for Marketing – If you look back at the history of marketing in the digital space you’ll find that the best places for selling had little else to do with the product itself. They had to do with the brand name and reputation of the company. Today though there’s little point in worrying about this. What’s more important to the parent company is that sales of the cameras go up and they make money. This would obviously be the ultimate outcome if you’re concerned about the reputation.
- It’s More Cost-Effective – In terms of how much it would cost to run the lens manufacturing plants, it makes financial sense. There’s very little labor activity in either Thailand or Taiwan. The overhead is low and the local markets are saturated with products. It would be more efficient to locate these facilities elsewhere. Again though, the benefits to the parent company are clear.
- Its Location Will Provide Better Materials – The fact is that many of the raw materials come from countries in South America and Africa. Only a small proportion comes from Japan. If you were to shut down all lens factories in the world you’d still have a significant manufacturing center. The one thing that seems to be happening though is the shipping lanes for the raw materials are becoming more congested. That in turn lowers the price of the final product.
- Its Key Personnel Is Still There – A third point in the story that doesn’t get mentioned much is that the group of highly skilled engineers who lead the group of engineers that are responsible for making the most technically advanced digital camera won’t be moving as freely as they might like. They won’t be moving to other employment opportunities. If you take a look at their LinkedIn profiles, you’ll see that they have, in recent months, spent some considerable time in the United States. It seems that as things change at Nikon they are focused on Europe or Asia. This could be because they believe their leadership team has been effective and their management team is good. It also could be that as much as two-thirds of the company’s management and key personnel are based in the U.S., that they still expect to see most if not all of them based there going forward.
- The Future of Lens Production and Its Importance – Finally, another interesting piece of news from the article was about Nikon’s future lens production facilities. They’ll be expanding in two different places. One of those expansions will see them moving into a new type of lens production. They currently make standard full lens cameras but they also will make specialty lenses. The goal is to move more of their manufacturing capacity to this new area.
These moves by Nikon are both news and potentially very important to lens production in the long term. It’s hard to say how much of an impact these moves will have on the long term because the company has been so busy in the past few years. What I can tell you is that these moves, if true, are a huge step forward in expanding their lens manufacturing capabilities. I’ll wait and see how much further Nikon takes their success from here, but for those looking for news about Nikon’s lens production capabilities, this is a pretty big development. As always one has to be careful when reading through the news.