JETRO Annual Survey Finds Japanese Manufacturers in the US Maintain Strong Performance.Tokyo, Japan, Oct 26, 2006 - (JCN JCN Japan Corporate News
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JCN joint communications network (US DoD) Newswire) - The Japan External Trade Organization Japan External Trade Organization (日本貿易振興会 (JETRO JETRO Japan External Trade Organization ) released the results of its latest annual survey of Japanese manufacturers operating in the US.
A total of 621 companies replied to this survey, which JETRO's six US offices (Atlanta, Chicago, Houston, Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. , New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , and San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden ) conducted in July and August 2006. JETRO began this annual survey in 1981.
The percentage of companies forecasting operating profits Operating profit (or loss)
Revenue from a firm's regular activities less costs and expenses and before income deductions.
See operating income. for 2006 was the highest ever at 80.9%. 55.3% of the respondent companies expect to increase operating profits next year, demonstrating optimism despite price hikes of raw materials such as crude oil, iron and steel.
The main reason given for this improvement was an "increase in sales in the domestic (US) market" (65.4%). Since the last survey, the "increase in the overseas market" (30.9%) gained 10 points, suggesting that companies are increasingly turning to export.
An increase in Chinese imports has affected 59.3% of respondents, causing a "decline in sales prices"; 51.1% reported a "decrease in sales due to intensifying competition."
96.2% of Japanese manufacturers polled considered "low price" to be the strongest selling point selling point
An aspect of a product or service that is stressed in advertising or marketing.
Noun 1. selling point - a characteristic of something that is up for sale that makes it attractive to potential customers of Chinese products. To compete with these inexpensive goods, 46.0% of respondents either are or are planning to offer higher value-added products. 48.7% reported that increasing imports from China will enable them to "procure cheaper parts and raw materials."
Regarding Korean products, 48.1% of respondents find value in a fair cost-quality balance; 38.2% of respondents plan to offer higher value-added products, especially in the electric/electronics products and precision machinery industries, to remain competitive.
372 companies, or 76.4% of respondent companies, named the US as the most suitable FTA FTA
Future Teachers of America partner, and fostered the greatest expectations for a US-Japan FTA.
Over 60% of companies have local (US) procurement ratios of 51% or more, maintaining a high domestic procurement ratio. Countries enjoying increasing popularity as sources of procurement are: China (up 4.0 points to 66.1%), Mexico (up 3.2 points to 39.4%), and ASEAN ASEAN: see Association of Southeast Asian Nations.
in full Association of Southeast Asian Nations
International organization established by the governments of Indonesia, Malaysia, the Philippines, Singapore, and Thailand in countries.
Meanwhile, an increasing number of Japanese manufacturers are reducing procurement from Japan (up 3.8 points to 33.3%) and from Europe (up 8.9 points to 16.7%).
Production shifts to China, Mexico, and ASEAN countries seem to continue. 9.2% of companies reported plans to shift at least a portion of manufacturing processes overseas "within a year or two," in contrast to the 8.2% companies who shifted
"a year or two ago". China (20 companies) and Mexico (14 companies) are the top two favored relocation destinations, suggesting that many Japanese manufacturers, especially within the automobile industry automobile industry, the business of producing and selling self-powered vehicles, including passenger cars, trucks, farm equipment, and other commercial vehicles. , are venturing into the two nations due to an increased international division of labor.
9.5% of the companies polled have offshore operations. Outsourcing to Indian firms is popular in software development; system database development and maintenance; and IT-related helpdesks.
About 30% of the companies planning offshore operations are eyeing India, proof of the country's growing popularity.
About Japan External Trade Organization (JETRO)
JETRO, or the Japan External Trade Organization, is a government-related organization that works to promote mutual trade and investment between Japan and the rest of the world. Originally established in 1958 to promote Japanese exports abroad, JETRO's core focus in the 21st century has shifted toward promoting foreign direct investment into Japan and helping small to medium size Japanese firms maximize their global export potential.
Source: Japan External Trade Organization (JETRO)
Mr. Kunio Ito Mr. Junji Kurokawa North America Division Overseas Research Dept. Phone: +81-3-3582-5545
Copyright [c] 2006 JCN Newswire. All rights reserved. A division of Japan Corporate News Network K.K.