Reply to [OT] Quo vadis camera industry ?

Especially in these interesting times.

Olympus transferred its imaging business to financial investor Japan Industrial Partners (JIP) on January 1, 2021.

November 2021 Sony stops production of APS-C models of the A series, the favorable legacy model A7 II and the A7c.

January 2022 Canon communicates plans to close its only manufacturing facility in China.

In late January 2022, Canon communicates a price increase of up to USD 200 for a variety of lenses.

The global sales decline has now reached dimensions that will further accelerate a market shakeout.

For the development of year 2019 (before Covid-19) and the year 2021 CIPA (Camera & Imaging Products Association, Japan) reports:

Digital cameras total: 8.4 million or -45% compared to 2019

Fixed lens cameras: 3 million or – 55% compared to 2019

Single Lens Reflex Cameras: 2.2 million or – 50% compared to 2019

Mirrorless cameras: 3.1 million or – 21% compared to 2019

Total interchangeable lenses: 9.5 million or – 33% compared to 2019

Lenses 35 mm and above: 4.6 million or – 6% compared to 2019

Lenses below 35 mm: 4.9 million or – 47% compared to 2019

Overall, CIPA values all 2021 shipments by Japanese manufacturers at USD 7.2 billion, down 13% or 1.1 billion from 2019. Mirrorless 35 mm cameras and associated lenses lift the average value of sales volumes, which have fallen much more sharply. However, given that there was already a 17 percent decline from 2018 to 2019 and a 21 percent decline from 2017 to 2019, the latest development is not very surprising.

At the time of the iPhone’s introduction in 2007, “fixed lens” cameras had reached their peak. In 2008, 110 million of these cameras were sold. After that, the level of 100 million was maintained until 2011.

2011 – 2013 minus 50% to 46 million.
2013 – 2015 minus 51% to 22 million.
2015 – 2017 minus 41% to 13 million.
2017 – 2019 minus 49% to 6.6 million.
2019 – 2021 minus 55% to 3 million.

It takes little imagination that in the end, in a few years, only high-priced offerings from Leica, Canon, Sony, Ricoh, etc. will be offered.
Given annual smartphone sales of 1.4 billion, cameras with sensor sizes of “1/2.3” and smaller will probably disappear completely. Whether some demand for superzoom cameras will allow their continued production remains to be seen.

In 2021, 5.3 million interchangeable lens cameras (ILC) were shipped to markets. Of these, 2.2 million were DSLRs and 3.1 million were mirrorless cameras. Compared to 2019, 37% or 3.1 million fewer ILC’s were sold.

One of the biggest demanders of semiconductors is undoubtedly Apple, which sold 51 million more smartphones in 2021 than in 2019 (fiscal year October – September). Exploding demand for IT and telecom products drove Apple’s FY 2021 revenue growth of $105 billion, or 41 percent. This $105 billion growth alone, caused by changes in demand during the pandemic, exceeds the absolute figures for all Japanese camera manufacturers of $7.2 billion (2021) shown above by a factor of 15.

Today, Apple sells 5 million iPhones in a week. Nearly that many ILC’s are sold by Japanese manufacturers in a year.

Tesla is another “miracle company” From 2019 to 2020 deliveries were up 36% and looking at 2019 to 2021 we see a 154% increase. From 368,000 units to 936,000 units (sales up 119%).

Strong and growth-oriented companies will more or less force the semiconductor industry to give less and even less consideration to “shrinking” companies like those in the camera industry.

There will be no relief in the coming years, not in capacity and not in prices for semiconductors. The European Union already complained about the semiconductor shortage 3 years ago and it is assumed that the semiconductor demand will have doubled by 2030, i.e. in 8 years.

This projection takes into account developments such as those reported by the New York Times on February 8: “nearly 9 percent of the new cars sold last year [2021] worldwide were electric, up from 2.5 percent in 2019, according to the International Energy Agency – their rapid growth could make 2022 the year when the march of battery-powered cars became unstoppable, erasing any doubt that the internal combustion engine is lurching toward obsolescence.”

Canon, with currently (August 2021) almost 50% market share, is in the best position to offer a reasonably attractive and comprehensive range of products for the coming years. However, this will come at a price as market volume continues to decline.