Japan, electronic nation: NNR explains Japan’s return to form

A few decades ago, Japan was called ‘the electronic nation’ with numerous electronic products and parts manufactured and shipped from the region. More recently, relocation of production lines to overseas locations have accelerated after the appreciation of the Yen, leaving the Country without the former economic momentum.

Nowadays, the investment into the semiconductor sector has been towed by Taiwan, China, Korea, USA – and Japan’s position is currently assessed to be 5th in terms of export. However, the market share of Japanese manufacturers remains over 22%, which is 2nd place next to the USA. The movement of the semiconductor manufacturing equipment has been very active since last year and worldwide sales of semiconductor manufacturing equipment totaled $41.2 billion in 2016 (a 12% increase compared with the previous year) and growing. Export from Japan in 2016 reached US$8.75 billion – that exceeded last record boom of 2011. In addition, the figure is expected to be exceed again in 2017.

The main reason for the sharp demand highlighted here is the increasing interest in ‘3D-NAND’ technology-supporting smart phones and internet-connected devices such as PCs and tablets which require ever increasing memory. The demand is forecast to expand to air conditioners, refrigerators, TVs and automobiles.

When you hear automobile parts, you may recall radiators, silencers and seat belts. Those products have not been manufactured in Japan for a long time. Aside from hybrid vehicles and EV, high performance electric devices will be present in all kinds of automobiles. The control of fuel injection, car navigation systems, auto-braking systems, self-driving controls and so on – the demand for high tech in automotive is increasing rapidly. NNR Global Logistics has globally supported Japanese manufacturers of semiconductor, automotive, electronics and high tech equipment for nearly 60 years, so is well positioned to support the demand.

With regards to the economy: in 2016, there appeared to be a slight increase of 1.2% in annual growth of GDP. In Q1 2017 the growth of GDP was 0.3%, and the annual growth is forecast as 1.0%. Despite instabilities such as geopolitical risk, it is estimated that there will be stable economic growth at least until the Olympic year of 2020.

Japan and the United Kingdom remain strong economic partners. In 2015, the direct investment from Japan to the UK rose from ¥53,784 billion in 2014 to ¥62,577 billion. According to trade statistics the total amount of bilateral export and import has been growing year by year and trade between the two nations is reportedly over $17 billion, supporting mainly transportation equipment, machinery and medicine.

The number of the Japanese-affiliated companies in the UK is about 1,000. It is in second place to Germany. Also, the number of employees at Japanese-affiliated companies in the UK is over 140,000. It occupies approximately 30% of the whole EU Japanese-affiliated workforce and is No.1 in Europe.

So how is NNR positioned in Japan?

NNR Global Logistics has over 25 locations in Japan and is headquartered in Tokyo. The organisation delivers a complete suite of supply chain solutions, including significant warehousing and distribution services with strong presence in both Japan and the global market. NNR has signed global partnership programmes with major air and ocean carriers that enables NNR to secure capacity and pricing to facilitate our global organic expansion.

NNR, fulfilling Eastern promise.

 

Neil Blakemore, Product Development Manager, NNR Global Logistics

2017-07-20T14:04:30+00:00 July 20th, 2017|Far East, Japan, Regional Focus|