Japan and SKorea are really disappointing. The people there are incredibly brainwashed by their media to hate China through some weird form of ultra-nationalism/racism despite being so culturally connected to China.
What they want is for others to fight for them. But they can't seem to fully trust the Japs on the part of them being Chinese-looking.
bajingan
Senior Member
i don't think japan is as stupid as indians and willingly become us cannon fodders
Them signing up for rcep despite us objections says it all
AssassinsMace
Lieutenant General
Yes the countries closest to China know they will be suffering the most if they get involved. Where as Americans would rather believe countries would blindly sacrifice themselves just for what they want. It's says a lot when they don't just say the West and relegated to Anglosphere.
plawolf
Lieutenant General
1984 was written by a WWII BBC propagandist based on his personal experiences working for the BBC but projected onto the Russians. It is so successful because there are a lot of core truths about the western propaganda playbook sprinkled in there, most of which are still being actively used today.
But in many ways, it is also an illustration on the gradual ossification and stagnation of western elite thought, that they are still re-packaging the same stuff from 80 years ago.
This is what happens when you artificially hold some man-made concepts as sacred and beyond questioning. How can you make meaningful advancements when existing political, economic, religious and media structures are deemed as perfect? All that is really left is social, which may explain why western society is going nuts with its ridiculous personal identification nonsense fads and dangerous/repugnant mass social experimentation and generally splitting by the seams.
Decoupling denied: Japan Inc. lays its bets on China
US-China trade rift creates havoc and opportunity for Asia's economic giants
MITSURU OBE, Nikkei staff writer
FEBRUARY 10, 2021 06:00 JST
TOKYO -- In 1978, when Chinese leader Deng Xiaoping visited a factory belonging to what is now Panasonic Corp. in Osaka, he made Chairman Konosuke Matsushita an offer he couldn't refuse.
That year, China's economy lay in ruins following the Cultural Revolution. But Deng had an idea. Turning to Matsushita, his guide on the tour, he said: "You are called the god of management. Will you help us modernize our economy?"
Matsushita, fatefully, agreed. The following year he traveled to China and told Beijing factory workers, "You are working very hard to learn to make TVs. If you keep up the effort, you'll catch up with Japan in several years and start developing new technologies."
He was right. In 1987, Panasonic established Japan's first Chinese joint venture in Beijing, training 250 assembly line workers in Japan for half a year to finally launch local production in 1989.
Matsushita did not live to see the fruits of this bargain: Today, China accounts for 1.7 trillion yen ($16 billion), or a quarter of Panasonic's business, including sales within China, and exports mainly to Japan.
But while Matsushita's farsighted championing of China created what is today one of Panasonic's biggest markets, it also created its most powerful competitor. Today, China churns out half of the world's refrigerator and washing machine production and 85% of air conditioners, according to Panasonic. Homegrown brands like Midea and Haier now hold a dominant place in the global appliance market, leaving Japanese companies largely in the dust.
Tetsuro Homma has seen the story play out since the beginning. He was one of the first Panasonic employees to learn Chinese in 1986 in preparation for the company's big China push. Today, he is CEO of Panasonic's in-house China & Northeast Asia Company. And he is presiding over a key decision by the 102-year-old company: whether to move its appliance headquarters, or at least some of its global business functions, to China.
"The operations have been led by Japan because it was the biggest market. The situation is different today," Homma says. With about 52,000 employees and some 80 subsidiaries in China, Panasonic's launch of the China & Northeast Asia Company in 2019 shows that the company is looking beyond the U.S.-China trade war and into the next 10 to 20 years.
"I don't think that the Japanese manufacturing industry could survive globally without being present in a market as big as China's," Homma told Nikkei Asia, interviewed by video link. Competition is fierce in China because it attracts players around the world. "Being able to compete in China is a ticket to competing in the global market," he said.
Panasonic's technology still leads its Chinese competitors, but only just. And it struggles to carve out high-end niches in the market it once ruled, in an effort to compete.
One example of such a niche is the EH-XD 30, a $620 Wi-Fi-enabled hair dryer. Released in August, it syncs with your smartphone, achieving optimal moisture levels by adjusting the amount of electrified particles it blows into hair to the UV and humidity in the atmosphere. Then there is a smart toilet that measures body fat and urine content and sends the data to your smartphone.
"Japanese consumers tend to avoid something unusual. By contrast, Chinese consumers like a new product or a new technology," Homma said. "Unless you have one of these, you cannot get their [Chinese consumers'] attention."
Market squeeze, shrinking leads
Panasonic's decision to further Sinify its operations is a decisive vote of confidence in a trading model that it pioneered: bargaining technology to China in exchange for access to the largest market in the world.
It is a game that it managed to stay ahead of for four decades, maintaining a technological lead over its Chinese competitors -- albeit a shrinking one. Most multinational corporations are in the same boat, whether German carmakers or U.S. communications equipment companies. They play by China's rules and give away technology as the price of market access.
The strategy comes with its own risks. Ke Ding, a researcher at the Japan External Trade Organization, said that direct investment in China does make it easier for China to catch up to Japanese companies. To avoid import duties and transport costs, "foreign companies try to procure parts locally by training local suppliers in parts production and creating a supply chain in China," he said.
Foreign companies also serve as a training ground for local managers, who may go on to set up their own companies or, later, become recruited by Chinese rivals. But despite all that, Japanese companies are still protective of their presence in China, he said. "Fast-growing China is a more profitable market than mature economies, and more profit means more money for R&D and keeping ahead of the competition," Ke Ding said.
The other reason Japan Inc. invests in China is the presence of a vast and sophisticated supply chain. Complex products like cars require a huge number of components and a large supplier network, which exist in China but not necessarily in up-and-coming competitors like Southeast Asia. In fact, "companies that have moved to Southeast Asia often have to import parts from China due to a lack of local suppliers," Ke Ding said.
Panasonic's example illustrates the shifting fortunes of the two largest Asian economies: In 2000, Japan's economy was four times as big as China's. In 2010, China overtook Japan, and today it is nearly three times as large. Even pressure from its own government and the U.S. has not been enough to wean Japan Inc. off its dependence on the China market.
In the wake of the Sino-American trade war and the "decoupling" of the two countries' technology sectors, the U.S. government has been pushing its multinational corporations like Apple to move supply chains away from China. Washington expects allied governments, like Japan, to follow suit. Washington has also banned any companies from selling U.S. technology to Huawei Technologies, the Chinese telecommunications infrastructure giant.
But while Tokyo has tried to wean its companies off China, even offering subsidies to Japanese companies to exit the China market, it is clear that leaving China is easier said than done.
Japanese companies operating in China remain bullish: Just 7.2% of them said they were moving or considering moving production out of China in a September survey by JETRO, down from 9.2% in 2019.
Naoto Saito, chief researcher at the Daiwa Institute of Research, said: "Japan Inc. is actually increasing its investment in China, while also seeking to set reasonable limits due to geopolitical risks, and remaining aware of avoiding overdependence." He added: "It's unthinkable for companies not to consider the Chinese market at all."
But trading technology for access has its drawbacks: Many Japanese industries have been sacrificed as Chinese companies turned around and used their technology to compete with them abroad. Japan's motorcycle industry, high-speed trains, and, of course, electrical appliances are some industries where Japanese investment in China created powerful international competitors. Others will undoubtedly follow.
"We are probably three to four years ahead of the Chinese," said Norio Nakajima, president of Murata Manufacturing, the world's largest maker of capacitors. But "their pace of catch-up is getting faster."
Japan Inc. is mostly doubling down on China, and one prime example is Toyota Motor. The carmaker took the opposite approach to Panasonic in the late 1970s: After Deng returned from his 1978 visit to Japan, the Chinese government asked Toyota to come to China to open local production. The Japanese automaker declined, choosing to focus on moving production to the U.S. Toyota now recognizes this as a strategic error of historic proportions.
In 1994, Toyota belatedly announced a plan to enter China, but it took until 2000 to form its first joint venture in Tianjin. Today, its sales numbers tell the tale: At rivals Honda Motor and Nissan Motor, China accounted for about 30% of sales volume in the fiscal year ended March 2020, but at Toyota that share was only 18%.
US-China trade rift creates havoc and opportunity for Asia's economic giants
MITSURU OBE, Nikkei staff writer
FEBRUARY 10, 2021 06:00 JST
TOKYO -- In 1978, when Chinese leader Deng Xiaoping visited a factory belonging to what is now Panasonic Corp. in Osaka, he made Chairman Konosuke Matsushita an offer he couldn't refuse.
That year, China's economy lay in ruins following the Cultural Revolution. But Deng had an idea. Turning to Matsushita, his guide on the tour, he said: "You are called the god of management. Will you help us modernize our economy?"
Matsushita, fatefully, agreed. The following year he traveled to China and told Beijing factory workers, "You are working very hard to learn to make TVs. If you keep up the effort, you'll catch up with Japan in several years and start developing new technologies."
He was right. In 1987, Panasonic established Japan's first Chinese joint venture in Beijing, training 250 assembly line workers in Japan for half a year to finally launch local production in 1989.
Matsushita did not live to see the fruits of this bargain: Today, China accounts for 1.7 trillion yen ($16 billion), or a quarter of Panasonic's business, including sales within China, and exports mainly to Japan.
But while Matsushita's farsighted championing of China created what is today one of Panasonic's biggest markets, it also created its most powerful competitor. Today, China churns out half of the world's refrigerator and washing machine production and 85% of air conditioners, according to Panasonic. Homegrown brands like Midea and Haier now hold a dominant place in the global appliance market, leaving Japanese companies largely in the dust.
Tetsuro Homma has seen the story play out since the beginning. He was one of the first Panasonic employees to learn Chinese in 1986 in preparation for the company's big China push. Today, he is CEO of Panasonic's in-house China & Northeast Asia Company. And he is presiding over a key decision by the 102-year-old company: whether to move its appliance headquarters, or at least some of its global business functions, to China.
"The operations have been led by Japan because it was the biggest market. The situation is different today," Homma says. With about 52,000 employees and some 80 subsidiaries in China, Panasonic's launch of the China & Northeast Asia Company in 2019 shows that the company is looking beyond the U.S.-China trade war and into the next 10 to 20 years.
"I don't think that the Japanese manufacturing industry could survive globally without being present in a market as big as China's," Homma told Nikkei Asia, interviewed by video link. Competition is fierce in China because it attracts players around the world. "Being able to compete in China is a ticket to competing in the global market," he said.
Panasonic's technology still leads its Chinese competitors, but only just. And it struggles to carve out high-end niches in the market it once ruled, in an effort to compete.
One example of such a niche is the EH-XD 30, a $620 Wi-Fi-enabled hair dryer. Released in August, it syncs with your smartphone, achieving optimal moisture levels by adjusting the amount of electrified particles it blows into hair to the UV and humidity in the atmosphere. Then there is a smart toilet that measures body fat and urine content and sends the data to your smartphone.
"Japanese consumers tend to avoid something unusual. By contrast, Chinese consumers like a new product or a new technology," Homma said. "Unless you have one of these, you cannot get their [Chinese consumers'] attention."
Market squeeze, shrinking leads
Panasonic's decision to further Sinify its operations is a decisive vote of confidence in a trading model that it pioneered: bargaining technology to China in exchange for access to the largest market in the world.
It is a game that it managed to stay ahead of for four decades, maintaining a technological lead over its Chinese competitors -- albeit a shrinking one. Most multinational corporations are in the same boat, whether German carmakers or U.S. communications equipment companies. They play by China's rules and give away technology as the price of market access.
The strategy comes with its own risks. Ke Ding, a researcher at the Japan External Trade Organization, said that direct investment in China does make it easier for China to catch up to Japanese companies. To avoid import duties and transport costs, "foreign companies try to procure parts locally by training local suppliers in parts production and creating a supply chain in China," he said.
Foreign companies also serve as a training ground for local managers, who may go on to set up their own companies or, later, become recruited by Chinese rivals. But despite all that, Japanese companies are still protective of their presence in China, he said. "Fast-growing China is a more profitable market than mature economies, and more profit means more money for R&D and keeping ahead of the competition," Ke Ding said.
The other reason Japan Inc. invests in China is the presence of a vast and sophisticated supply chain. Complex products like cars require a huge number of components and a large supplier network, which exist in China but not necessarily in up-and-coming competitors like Southeast Asia. In fact, "companies that have moved to Southeast Asia often have to import parts from China due to a lack of local suppliers," Ke Ding said.
Panasonic's example illustrates the shifting fortunes of the two largest Asian economies: In 2000, Japan's economy was four times as big as China's. In 2010, China overtook Japan, and today it is nearly three times as large. Even pressure from its own government and the U.S. has not been enough to wean Japan Inc. off its dependence on the China market.
In the wake of the Sino-American trade war and the "decoupling" of the two countries' technology sectors, the U.S. government has been pushing its multinational corporations like Apple to move supply chains away from China. Washington expects allied governments, like Japan, to follow suit. Washington has also banned any companies from selling U.S. technology to Huawei Technologies, the Chinese telecommunications infrastructure giant.
But while Tokyo has tried to wean its companies off China, even offering subsidies to Japanese companies to exit the China market, it is clear that leaving China is easier said than done.
Japanese companies operating in China remain bullish: Just 7.2% of them said they were moving or considering moving production out of China in a September survey by JETRO, down from 9.2% in 2019.
Naoto Saito, chief researcher at the Daiwa Institute of Research, said: "Japan Inc. is actually increasing its investment in China, while also seeking to set reasonable limits due to geopolitical risks, and remaining aware of avoiding overdependence." He added: "It's unthinkable for companies not to consider the Chinese market at all."
But trading technology for access has its drawbacks: Many Japanese industries have been sacrificed as Chinese companies turned around and used their technology to compete with them abroad. Japan's motorcycle industry, high-speed trains, and, of course, electrical appliances are some industries where Japanese investment in China created powerful international competitors. Others will undoubtedly follow.
"We are probably three to four years ahead of the Chinese," said Norio Nakajima, president of Murata Manufacturing, the world's largest maker of capacitors. But "their pace of catch-up is getting faster."
Japan Inc. is mostly doubling down on China, and one prime example is Toyota Motor. The carmaker took the opposite approach to Panasonic in the late 1970s: After Deng returned from his 1978 visit to Japan, the Chinese government asked Toyota to come to China to open local production. The Japanese automaker declined, choosing to focus on moving production to the U.S. Toyota now recognizes this as a strategic error of historic proportions.
In 1994, Toyota belatedly announced a plan to enter China, but it took until 2000 to form its first joint venture in Tianjin. Today, its sales numbers tell the tale: At rivals Honda Motor and Nissan Motor, China accounted for about 30% of sales volume in the fiscal year ended March 2020, but at Toyota that share was only 18%.
...continued
Toyota got a second chance in 2018 as Chinese Premier Li Keqiang visited its plant in Hokkaido. Li took interest in Toyota's fuel cell vehicle, a technology Li saw as key to emissions reduction. This time, Toyota did not miss the Chinese overture. "This is our last chance," a Toyota executive said.
In June 2020, Toyota announced the establishment of a joint venture with five Chinese companies to develop fuel cell systems for commercial vehicles. The partners include China First Automobile Works and Guangzhou Automobile Group, two longtime Toyota JV partners. Then, in October, Toyota agreed to supply Guangzhou Automobile its gasoline-electric hybrid system -- the first time for it to be offered to a foreign company. Toyota also released a Lexus electric vehicle and an all-electric SUV in China ahead of Japan last year.
In 2019, Toyota formed a partnership with two Chinese autonomous driving startups -- with Pony.ai for road testing and with Momenta for high-definition mapping. That same year, the Japanese company joined the Apollo project, the self-driving development platform spearheaded by Chinese search engine provider Baidu.
These moves are double-edged, designed to deal with both the difficulty of transferring American-developed technology to China, as well as gearing their products more toward the Chinese market.
"Toyota will continue to increase the extent of local production," a spokesperson said.
Meanwhile, the company is also hedging its bets with investment in other markets. "We are also taking early steps" for frontier markets, the spokesperson said, referring to Toyota's capital partnership with Suzuki Motor to expand in India and a business expansion in Africa by Toyota Tsusho, a Toyota group trading house. In Southeast Asia, it works with its Daihatsu subsidiary, which produces the most cars in Indonesia for itself and other brands, and operates the Perodua unit, the largest carmaker in Malaysia.
Many foreign companies remain confident they can stay ahead, even as they share their technology. One example is Kyoto-based Nidec, the world's largest motor maker, which is investing in China to meet the rapidly growing demand for electric vehicles.
For Nidec, there is no substitute. Aiming to grab 40% to 45% of the global market for EV motors by 2030, it has no choice but to focus on China, the world's biggest EV market. Given the stakes, they have successfully fended off the Japanese government's push to diversify production away from the giant neighbor.
At its Dalian plant -- one of two main production bases in China, and where the company set up its market presence in 1992 -- a second production line for EV motors, costing close to $1 billion, is under construction. So is a research and development facility with a staff of 1,000. Both are due to come online this year.
"It is my policy to do different things and ahead of other people," said Nidec Chairman and CEO Shigenobu Nagamori. He predicts China will become the company's biggest market but added that it is also eyeing expansion in countries near China, such as Vietnam and the Philippines.
"I started doing business in Vietnam before the diplomatic normalization between the U.S. and Vietnam" in 1995, he said. "I was able to develop a strong business base because I went in when nobody else did."
When Nagamori met with Donald Trump in Tokyo in 2019, the then-U.S. president criticized Nagamori for being too focused on China. He replied that Nidec actually makes roughly the same amount of investment in the U.S. as in China.
"As a business owner, I don't have any country I like or don't like. My company operates on a global basis," he said. "We have operations in 43 countries."
He observed that Japan does not have to fear China's rise. "China isn't good at everything," Nagamori stresses.
"The tie I'm wearing is Italian. Japanese ties aren't wearable," he said, pointing to his green and gold striped tie. "Uniqueness is a strength. That's how Japan competes against China."
Decoupling by degrees
Not everyone is so optimistic. Japan sees manufacturing as its strength, but "it's getting harder to differentiate from Chinese products, especially in the area of consumer electronics," Murata President Nakajima warned. "Chinese have a lot of money, a large labor pool and many talented people. Their pace of catch-up is very fast."
Nakajima notes, however, that the Japanese have more experience in research and development, as well as a longer investment time horizon.
Demand for Murata's capacitors -- a tiny device that helps smooth voltage and protects the delicate electronic components in smartphones and computers -- surged as mobile phone sales took off in the late 1990s. In the 2000s, Murata expanded into China by following Japanese electronics customers.
Today, Murata's customers go beyond Japanese electronics makers to include Huawei, Xiaomi, Oppo and Vivo as well as Apple and Samsung Electronics. Greater China accounts for more than half of Murata's sales.
But the U.S.-China trade war is complicating Murata's growth strategy as Nakajima, the president, warns about an emerging decoupled world. "The world would be divided into two economic spheres if U.S.-China tensions continue under the Biden administration," said Nakajima in an interview.
Toyota got a second chance in 2018 as Chinese Premier Li Keqiang visited its plant in Hokkaido. Li took interest in Toyota's fuel cell vehicle, a technology Li saw as key to emissions reduction. This time, Toyota did not miss the Chinese overture. "This is our last chance," a Toyota executive said.
In June 2020, Toyota announced the establishment of a joint venture with five Chinese companies to develop fuel cell systems for commercial vehicles. The partners include China First Automobile Works and Guangzhou Automobile Group, two longtime Toyota JV partners. Then, in October, Toyota agreed to supply Guangzhou Automobile its gasoline-electric hybrid system -- the first time for it to be offered to a foreign company. Toyota also released a Lexus electric vehicle and an all-electric SUV in China ahead of Japan last year.
In 2019, Toyota formed a partnership with two Chinese autonomous driving startups -- with Pony.ai for road testing and with Momenta for high-definition mapping. That same year, the Japanese company joined the Apollo project, the self-driving development platform spearheaded by Chinese search engine provider Baidu.
These moves are double-edged, designed to deal with both the difficulty of transferring American-developed technology to China, as well as gearing their products more toward the Chinese market.
"Toyota will continue to increase the extent of local production," a spokesperson said.
Meanwhile, the company is also hedging its bets with investment in other markets. "We are also taking early steps" for frontier markets, the spokesperson said, referring to Toyota's capital partnership with Suzuki Motor to expand in India and a business expansion in Africa by Toyota Tsusho, a Toyota group trading house. In Southeast Asia, it works with its Daihatsu subsidiary, which produces the most cars in Indonesia for itself and other brands, and operates the Perodua unit, the largest carmaker in Malaysia.
Many foreign companies remain confident they can stay ahead, even as they share their technology. One example is Kyoto-based Nidec, the world's largest motor maker, which is investing in China to meet the rapidly growing demand for electric vehicles.
For Nidec, there is no substitute. Aiming to grab 40% to 45% of the global market for EV motors by 2030, it has no choice but to focus on China, the world's biggest EV market. Given the stakes, they have successfully fended off the Japanese government's push to diversify production away from the giant neighbor.
At its Dalian plant -- one of two main production bases in China, and where the company set up its market presence in 1992 -- a second production line for EV motors, costing close to $1 billion, is under construction. So is a research and development facility with a staff of 1,000. Both are due to come online this year.
"It is my policy to do different things and ahead of other people," said Nidec Chairman and CEO Shigenobu Nagamori. He predicts China will become the company's biggest market but added that it is also eyeing expansion in countries near China, such as Vietnam and the Philippines.
"I started doing business in Vietnam before the diplomatic normalization between the U.S. and Vietnam" in 1995, he said. "I was able to develop a strong business base because I went in when nobody else did."
When Nagamori met with Donald Trump in Tokyo in 2019, the then-U.S. president criticized Nagamori for being too focused on China. He replied that Nidec actually makes roughly the same amount of investment in the U.S. as in China.
"As a business owner, I don't have any country I like or don't like. My company operates on a global basis," he said. "We have operations in 43 countries."
He observed that Japan does not have to fear China's rise. "China isn't good at everything," Nagamori stresses.
"The tie I'm wearing is Italian. Japanese ties aren't wearable," he said, pointing to his green and gold striped tie. "Uniqueness is a strength. That's how Japan competes against China."
Decoupling by degrees
Not everyone is so optimistic. Japan sees manufacturing as its strength, but "it's getting harder to differentiate from Chinese products, especially in the area of consumer electronics," Murata President Nakajima warned. "Chinese have a lot of money, a large labor pool and many talented people. Their pace of catch-up is very fast."
Nakajima notes, however, that the Japanese have more experience in research and development, as well as a longer investment time horizon.
Demand for Murata's capacitors -- a tiny device that helps smooth voltage and protects the delicate electronic components in smartphones and computers -- surged as mobile phone sales took off in the late 1990s. In the 2000s, Murata expanded into China by following Japanese electronics customers.
Today, Murata's customers go beyond Japanese electronics makers to include Huawei, Xiaomi, Oppo and Vivo as well as Apple and Samsung Electronics. Greater China accounts for more than half of Murata's sales.
But the U.S.-China trade war is complicating Murata's growth strategy as Nakajima, the president, warns about an emerging decoupled world. "The world would be divided into two economic spheres if U.S.-China tensions continue under the Biden administration," said Nakajima in an interview.
...continued
The Chinese market is "too large for us to ignore," he added. "Given its size and the pace of growth, there would be no choice but to develop products for that market, in addition to ones for the Western and Japanese market."
That is not necessarily an easy thing to do, Nakajima points out. Some electronic devices are difficult to manufacture without American equipment, such as computer-aided design tools, he said. In order to supply to China, replacement equipment needs to be found.
Facing a rapidly decoupling world, Murata and most of Japan Inc. is sticking with the Chinese market, an outcome that runs counter to the advice from the Japanese government, which has been urging Japanese companies to diversify away from China.
"It is absolutely necessary to strengthen supply chains in Japan and diversify those overseas in order to secure more sources of supply," said then-Prime Minister Shinzo Abe in August. Supply chain reforms "need to be implemented with a long-term perspective, and not just to reduce costs and increase profits," he said.
His successor, Yoshihide Suga, also counseled Japanese companies to diversify their supply chains into Southeast Asia in a speech in October.
Officials say that Japanese industry would be shortsighted if it clings to the China market. "The pace of China's economic growth has been slowing. Japanese companies should move to the next growth center of Southeast Asia and India," says an official responsible for economic security issues at the Japanese Ministry of Economy, Trade and Industry, reflecting advice given to the industry.
The official noted that the U.S.-China trade war and the coronavirus have made many Japanese companies anxious to diversify supply chains away from China. Last year's lockdown by China brought the supply of key parts to a halt and crippled Japanese supply chains.
Meanwhile, the trade war has also increased the unpredictability factor, leading to higher tariffs for products that are made in China and bans on the use of U.S. components and equipment for items exported to China. Some Japanese manufacturers, such as video game maker Nintendo and multifunction copier producers including Sharp, Ricoh and Kyocera, have shifted production to Vietnam and Thailand.
In Japan, salespeople work at big retail outlets to promote Panasonic products. In China, salespeople work behind the computer screen, chatting online with visitors to e-commerce sites, looking for Panasonic products such as hair dryers and electric shavers, answering their questions at lightning speed, and working in shifts from 6 a.m. to 2 a.m.
Homma said e-commerce has not spread in Japan as much as in China despite the coronavirus pandemic but expects other Asian countries, such as India, to follow China's lead and reckons that the online business model in China will help Panasonic expand in the rest of Asia.
Meanwhile, Homma is philosophical about the future. "China was extremely lucky that until recently it was able to export anything it wanted to the U.S. without worrying about political consequences," Homma said. "Japan has been involved in trade disputes with the U.S. for 50 years."
"China has optimized its economy for large-scale manufacturing and has focused its resources on investing, producing and exporting on a large scale," he said. "That age is over now."
Meanwhile, U.S. sanctions against Huawei have caused huge sales losses for Japanese chipmakers. The U.S. Commerce Department banned all exports to the Chinese telecommunications company of products made with American technology in September. Many fear this ban will be expanded, and they have begun looking for other markets to fill the gap left by a loss of sales to China's largest telecommunications equipment supplier.
Japanese companies supplied about $12 billion in parts to Huawei in 2020, according to U.K. research company Omdia.
Another source of uncertainty is the geopolitical environment: Chinese territorial claims in the East China Sea could turn ugly at any moment. "Japanese companies need to be aware that the Chinese market could disappear once tensions flare over the Senkaku Islands," the METI official said.
On the state-to-state level, China-Japan relations are uneven. Chinese President Xi Jinping's visit to Japan, originally slated for spring 2020, has been postponed and is yet to be fixed.
Panasonic keeps this Sino-American rivalry in mind as it plans its future. It produces industrial products, such as industrial robots and electronic devices, but it focuses on appliances in China. "We had to keep in mind the U.S.-China conflict when we created China & Northeast Asia Company," Homma said.
He said Panasonic has separated the businesses that do not involve sensitive technology -- appliances and housing equipment -- and brought them over to China. "We'll expand aggressively in China in these businesses," he said.
Based now in Beijing, Homma promotes Panasonic products by appearing on live streaming e-commerce programs in Chinese. In 2020, 51% of Panasonic's appliance sales in China took place online, up 7 points from a year before.
In Japan, salespeople work at big retail outlets to promote Panasonic products. In China, salespeople work behind the computer screen, chatting online with visitors to e-commerce sites, looking for Panasonic products such as hair dryers and electric shavers, answering their questions at lightning speed, and working in shifts from 6 a.m. to 2 a.m.
Homma said e-commerce has not spread in Japan as much as in China despite the coronavirus pandemic but expects other Asian countries, such as India, to follow China's lead and reckons that the online business model in China will help Panasonic expand in the rest of Asia.
Meanwhile, Homma is philosophical about the future. "China was extremely lucky that until recently it was able to export anything it wanted to the U.S. without worrying about political consequences," Homma said. "Japan has been involved in trade disputes with the U.S. for 50 years."
"China has optimized its economy for large-scale manufacturing and has focused its resources on investing, producing and exporting on a large scale," he said. "That age is over now."
The Chinese market is "too large for us to ignore," he added. "Given its size and the pace of growth, there would be no choice but to develop products for that market, in addition to ones for the Western and Japanese market."
That is not necessarily an easy thing to do, Nakajima points out. Some electronic devices are difficult to manufacture without American equipment, such as computer-aided design tools, he said. In order to supply to China, replacement equipment needs to be found.
Facing a rapidly decoupling world, Murata and most of Japan Inc. is sticking with the Chinese market, an outcome that runs counter to the advice from the Japanese government, which has been urging Japanese companies to diversify away from China.
"It is absolutely necessary to strengthen supply chains in Japan and diversify those overseas in order to secure more sources of supply," said then-Prime Minister Shinzo Abe in August. Supply chain reforms "need to be implemented with a long-term perspective, and not just to reduce costs and increase profits," he said.
His successor, Yoshihide Suga, also counseled Japanese companies to diversify their supply chains into Southeast Asia in a speech in October.
Officials say that Japanese industry would be shortsighted if it clings to the China market. "The pace of China's economic growth has been slowing. Japanese companies should move to the next growth center of Southeast Asia and India," says an official responsible for economic security issues at the Japanese Ministry of Economy, Trade and Industry, reflecting advice given to the industry.
The official noted that the U.S.-China trade war and the coronavirus have made many Japanese companies anxious to diversify supply chains away from China. Last year's lockdown by China brought the supply of key parts to a halt and crippled Japanese supply chains.
Meanwhile, the trade war has also increased the unpredictability factor, leading to higher tariffs for products that are made in China and bans on the use of U.S. components and equipment for items exported to China. Some Japanese manufacturers, such as video game maker Nintendo and multifunction copier producers including Sharp, Ricoh and Kyocera, have shifted production to Vietnam and Thailand.
In Japan, salespeople work at big retail outlets to promote Panasonic products. In China, salespeople work behind the computer screen, chatting online with visitors to e-commerce sites, looking for Panasonic products such as hair dryers and electric shavers, answering their questions at lightning speed, and working in shifts from 6 a.m. to 2 a.m.
Homma said e-commerce has not spread in Japan as much as in China despite the coronavirus pandemic but expects other Asian countries, such as India, to follow China's lead and reckons that the online business model in China will help Panasonic expand in the rest of Asia.
Meanwhile, Homma is philosophical about the future. "China was extremely lucky that until recently it was able to export anything it wanted to the U.S. without worrying about political consequences," Homma said. "Japan has been involved in trade disputes with the U.S. for 50 years."
"China has optimized its economy for large-scale manufacturing and has focused its resources on investing, producing and exporting on a large scale," he said. "That age is over now."
Meanwhile, U.S. sanctions against Huawei have caused huge sales losses for Japanese chipmakers. The U.S. Commerce Department banned all exports to the Chinese telecommunications company of products made with American technology in September. Many fear this ban will be expanded, and they have begun looking for other markets to fill the gap left by a loss of sales to China's largest telecommunications equipment supplier.
Japanese companies supplied about $12 billion in parts to Huawei in 2020, according to U.K. research company Omdia.
Another source of uncertainty is the geopolitical environment: Chinese territorial claims in the East China Sea could turn ugly at any moment. "Japanese companies need to be aware that the Chinese market could disappear once tensions flare over the Senkaku Islands," the METI official said.
On the state-to-state level, China-Japan relations are uneven. Chinese President Xi Jinping's visit to Japan, originally slated for spring 2020, has been postponed and is yet to be fixed.
Panasonic keeps this Sino-American rivalry in mind as it plans its future. It produces industrial products, such as industrial robots and electronic devices, but it focuses on appliances in China. "We had to keep in mind the U.S.-China conflict when we created China & Northeast Asia Company," Homma said.
He said Panasonic has separated the businesses that do not involve sensitive technology -- appliances and housing equipment -- and brought them over to China. "We'll expand aggressively in China in these businesses," he said.
Based now in Beijing, Homma promotes Panasonic products by appearing on live streaming e-commerce programs in Chinese. In 2020, 51% of Panasonic's appliance sales in China took place online, up 7 points from a year before.
In Japan, salespeople work at big retail outlets to promote Panasonic products. In China, salespeople work behind the computer screen, chatting online with visitors to e-commerce sites, looking for Panasonic products such as hair dryers and electric shavers, answering their questions at lightning speed, and working in shifts from 6 a.m. to 2 a.m.
Homma said e-commerce has not spread in Japan as much as in China despite the coronavirus pandemic but expects other Asian countries, such as India, to follow China's lead and reckons that the online business model in China will help Panasonic expand in the rest of Asia.
Meanwhile, Homma is philosophical about the future. "China was extremely lucky that until recently it was able to export anything it wanted to the U.S. without worrying about political consequences," Homma said. "Japan has been involved in trade disputes with the U.S. for 50 years."
"China has optimized its economy for large-scale manufacturing and has focused its resources on investing, producing and exporting on a large scale," he said. "That age is over now."
Hendrik_2000
Lieutenant General
Japan has no choice but to cooperate with China. The industrialist know this fact but face resistance from irredentist politician who still dream of Japan greatness and tie themselves to the west instead of making the humbling effort of acknowledging their heinous crime in WW II and make genuine reconciliation along the line of Franco-German reconciliation. The problem is Japan politic smack of feudalism where politician rose from the descendant of old political family and the larger population just acquiesce to the fact. But at least they don't whine about China stealing the technology when they know it is straight bargain market access for technology that is win-win for bot side. It is beneficial to have foreign investment and China is self assured enough to allow it because it become the training ground for both technical, management and sooner or later some manager jump the ship and open their own companies . And the creation of supply chain in China
The strategy comes with its own risks. Ke Ding, a researcher at the Japan External Trade Organization, said that direct investment in China does make it easier for China to catch up to Japanese companies. To avoid import duties and transport costs, "foreign companies try to procure parts locally by training local suppliers in parts production and creating a supply chain in China," he said.
Foreign companies also serve as a training ground for local managers, who may go on to set up their own companies or, later, become recruited by Chinese rivals. But despite all that, Japanese companies are still protective of their presence in China, he said. "Fast-growing China is a more profitable market than mature economies, and more profit means more money for R&D and keeping ahead of the competition," Ke Ding said.
The other reason Japan Inc. invests in China is the presence of a vast and sophisticated supply chain. Complex products like cars require a huge number of components and a large supplier network, which exist in China but not necessarily in up-and-coming competitors like Southeast Asia. In fact, "companies that have moved to Southeast Asia often have to import parts from China due to a lack of local suppliers," Ke Ding said.
The strategy comes with its own risks. Ke Ding, a researcher at the Japan External Trade Organization, said that direct investment in China does make it easier for China to catch up to Japanese companies. To avoid import duties and transport costs, "foreign companies try to procure parts locally by training local suppliers in parts production and creating a supply chain in China," he said.
Foreign companies also serve as a training ground for local managers, who may go on to set up their own companies or, later, become recruited by Chinese rivals. But despite all that, Japanese companies are still protective of their presence in China, he said. "Fast-growing China is a more profitable market than mature economies, and more profit means more money for R&D and keeping ahead of the competition," Ke Ding said.
The other reason Japan Inc. invests in China is the presence of a vast and sophisticated supply chain. Complex products like cars require a huge number of components and a large supplier network, which exist in China but not necessarily in up-and-coming competitors like Southeast Asia. In fact, "companies that have moved to Southeast Asia often have to import parts from China due to a lack of local suppliers," Ke Ding said.