Sony Corp, the world's second-largest consumer-electronics maker, will increase production of digital cameras in China tenfold to meet demand for the devices in Asia's fastest growing market and to lower costs.
Sony, which has a fifth of the world's digital-camera market, will increase production to 500,000 units in the fiscal year starting April 1, Sony spokeswoman Mami Imada said, confirming an earlier article in the Nihon Keizai newspaper.
The cameras, which will be made at a Shanghai plant, will be sold in China, she said.
Worldwide sales of digital cameras are expected to rise to 40 million units this year from 25 million units last year, according to Hideki Wakabayashi, an analyst at Mizuho Securities Co.
China's digital-camera market will probably account for 1 million units, Sony's Imada said.
"The digital-camera market in China is growing rapidly," Imada said. "The factory will be able to make a full lineup of digital cameras this year."
The added production would represent a tenfold increase over the current fiscal year's expected output, Imada said.
A Cybershot in the arm
Sony, which makes the Cybershot digital camera, said last month digital cameras were among its best-selling electronics in the three months ended Dec. 31.
Digital cameras are also fueling sales of semiconductors and small-sized liquid-crystal displays, components that the Tokyo-based company also makes.
The company's video division, which includes digital cameras, accounted for about 11 percent of Sony's total sales in the three months ended December.
"It's a very positive move as the production of digital cameras is growing rapidly," said Nishichi Omori, general manager at UFJ Asset Management, which manages about ?1 trillion (US$8.4 billion) in assets.
Sony last week said it will spend ?25 billion to boost production of the chips used in digital cameras.
Sales of products such as digital cameras to holiday shoppers helped Sony increase operating profit 14 percent in the three months ended Dec. 31. Sony's net income almost doubled in the third quarter to ?125.4 billion.
Sony's shares have declined about 4 percent since the company reported earnings for the October-December period on Jan. 29. The Nikkei 225 Stock Average rose 2.4 percent in the same period.
Shares of Sony fell 2 percent to 4,590 on Friday.
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