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Japanese Mobile Phone Makers May Shift Production to China
Two major Japanese mobile phone part makers said Tuesday they may move production bases to China to side-step a painful 100 percent tariff imposed by Beijing on certain products made in Japan.
Kyocera Corp., the world's largest maker of computer ceramics, used in mobile telephones, said it was considering moving production of personal handy phone (PHS) parts to China because the 100 percent tariff hike meant its exports to the country were no longer competitive.
"If the tariffs continue we are thinking about shifting (production) to China to get around the problem," said Kyocera spokesman Masaaki Ito.
The technology leader ceased exports of PHS units to China earlier this month because of the hike in duties.
"Our products are now so expensive no one wants to buy them," said Ito.
This year the company had hoped to ship 30 billion yen's (250 million dollars) worth of mobile phone components to China.
Japan's Sanyo Electric Co. Ltd. said it too had halted exports to China as a result of the tariff hike and was adopting a "wait-and-see" stance regarding whether to shift production to Chinese mainland.
"When the tariffs were first announced, we had hoped PHS units would not be included as they were not specifically mentioned, but now it seems as though this was just wishful thinking," said company spokesman Derek Wentz.
"We have not stopped production but the 100 percent tax price makes our products so expensive that Chinese buyers do not want to purchase them so we have stopped exporting for now," said a second Sanyo spokesman Akihito Oiwa.
Instead the company is shipping more units to Taiwan and Hong Kong, the pair said.
"We have adopted a wait-and-see stance to find out how long this (trade row) continues, but moving our production to China is definitely a possibility," said Wentz.
Sanyo would wait until the end of the year, and if nothing had changed it may move production to the mainland, he said.
Sanyo had hoped to export 200,000 PHS units to Chinese mainland, Chinese Taiwan and Thailand by the end of March 2002, but declined to comment on whether or not it felt this figure would be achieved.
In late April, Tokyo slapped emergency tariffs on imports of spring onions, fresh mushrooms and tatami rushes.
China, the top exporter of these products to Japan, was the government's main target.
In retaliation, Beijing last month imposed 100 percent extra tariffs on automobiles, mobile telephones and air conditioners made in Japan.
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