Thu, Jul 01, 2004 - Page 10 News List

Digital camera production forecast to rise 20%

CNA , TAIPEI

Taiwan's production of digital cameras will rise to 20.5 million this year, an increase of about 20 percent over last year's level of 17.2 million, according to estimates released yesterday by the Taipei-based Topology Research Institute (TRI, 拓墣產業研究所).

The growth can be attributed to heavy demand from foreign buyers, such as New York-based Eastman Kodak Co, for locally made digital cameras, and a successful exploration of new markets in Europe, a TRI researcher said.

Last week, Sony Corp said it may increase its target to 16.5 million digital cameras from sales of 15 million it forecast in April as consumers increasingly switch to digital pictures, attracted by improved image quality.

The Japanese company expected industry shipments to rise 55 percent this year. In the first four months, they increased 69 percent compared with the same period a year earlier.

Sony expects the global digital camera market to grow about 30 percent in the year ending March 2006, to 82 million units, said Katsuya Nakagawa, head of product planning for Sony's Cyber-shot cameras.

However, the TRI researcher pointed out that this year will be a very tough one for Taiwanese contractors amid falling profits, on the grounds that many manufacturers are already receiving orders at prices lower than their running costs.

He forecast that earnings by Taiwanese makers this year will be smaller amid fiercer competition, a development that might result in mergers or closures.

Breaking into new markets outside the US and Europe will be a key to sustained profitability, the researcher said.

He predicted that the situation will improve in the third quarter of next year, at a time when large Japanese companies are expected to release more orders for digital cameras of three or four megapixels to outsourcers.

Taiwanese digital-camera makers have continued to ship higher-resolution models, with three megapixel cameras comprising around 36.1 percent of shipments in the fourth quarter last year, according to figures from the semi-official technology researcher Market Intelligence Center (市場情報中心).

About 20 percent of Taiwanese families are expected to own a digital camera this year, up from 17 percent late last year, Kodak Taiwan (台灣柯達) sales manager King Yu-chen (金玉珍) said in late March.

King said the penetration rate of digital cameras among Taiwanese will increase this year thanks to product simplification that makes the devices easier to use.

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