Updated as of October 2005

Digital Cameras Keep Things Clicking Along.

As of 2003, Japan's precision instrument and equipment manufacturing industry consisted of approximately 4,700 establishments (employing 4 or more) with an overall total of about 154,000 employees and shipped 3,588 billion yen worth of products annually.

This amount represents sales of all products shipped by those companies classified primarily as precision instrument and equipment manufacturers. Most of these companies are also engaged in manufacturing other categories of products, such as facsimile machines and other electronic business equipment normally classified in the electronics industry category.

The 2003 value of shipments of selected products in the precision instrument and equipment category was 1,011 billion yen for optical equipment such as cameras, lenses and microscopes; 2,263 billion yen for non-electrical measurement/analytical instruments; and 314 billion yen for watches/clocks and their movements.

The total shipment value of all products in the precision instrument category remained between 3,500 billion yen and 5,000 billion yen in the past decade, except for 1991 when the shipment value hit a peak of 5,510 billion yen. However, the shipment value for watches, clocks, and their movements drastically decreased by some 60 percent from approximately 1,100 billion yen during the early 1990s to 314 billion yen in 2003. The shipment value of optical instruments such as cameras, lens, and other optical instruments, also declined by 30 to 55 percent in the same period.

The total value of imports of precision instruments reached 1,446 billion yen in 2004 -- up 8.3 percent from 1,335 billion yen in 2003 -- while exports increased by approximately 21.1 percent in 2004 to 2,610 billion yen -- up from 2,154 billion yen in 2003 -- as demand for components for offshore production rose sharply.

The total value of imports of all precision instruments in 2001 was 1,269 billion yen or $10 billion, up 11 percent from 1,143 billion yen in 2000. Imports of products in this segment totaled 660 billion yen or $5.3 billion in 1995, but have surged drastically to over 1,000 billion yen since 1997.

The total value of exports of all products in this segment amounted to 2,610 billion yen or $24.6 billion in 2004, down 5.9 percent from 2,773 billion yen in 2000. Exports of precision products in 1990 amounted to 2,001 billion yen, a sharp decline from 4,247 billion yen in 1985, and stayed at the same level or slightly declined until 1995, but then gradually recovered and rose vigorously to the current level. This rise was due primarily to the remarkable growth of exports of scientific, medical and optical products in the past decade, which rose from 1,736 billion yen in 1995 to 2,610 billion yen in 2004, except for a period of economic depression between 2001 and 2002.

For example, in the Japanese camera industry, digital camera sales showed stable growth, though with regional variations, achieving a high rate of market penetration as traditional cameras using silver halide films declined.

According to Camera & Imaging Products Association (CIPA), in 2004, the strong growth in the market for digital cameras continued from the previous year and the total shipment of digital cameras was approximately 59.8 million units, up 37.7 percent from the previous year. Though domestic shipment is expected to slow due to a pretty much saturated market, strong growth is expected to continue in the overseas market, thus demand for the total number of units will grow for sometime to come. Exports to the E.U. and other markets should continue to record strong growth, with a slightly weaker rate of growth expected in the U.S.

On the other hand, under the influences of competitive pricing and growing market penetration by digital cameras, the shipment of traditional cameras in 2004 dropped to about 10.1 million units, down 38.2 percent from the previous year.

In the copying machine industry, the total shipment of analog copying machines in 2004, including exports, was 0.6 million units, down 17.6 percent from the previous year. Shipment of digital copying machines reached 2.28 million units in 2004, a sharp increase by 17.2 percent from the previous year, while 500 thousand units of full-color copying machines were shipped, up 12.2 percent from 2003.

Sales of facsimile machines have been decreasing since 2001, affected by e-mail services and personal computers. In 2004, the production of fax machines was approximately 2.4 million units, and total sales were 2,360,706 units, a decline of 18.7 percent from the previous year.