More and more Japanese home appliance brands are quietly fading away from the Chinese market. Despite maintaining a stake in their mainland joint ventures, their influence continues to wane. These brands are increasingly transforming into niche products that retain a touch of Japanese design but are manufactured domestically.
The retreat of Japanese home appliances from China is a strategic shift, focusing on retaining market presence while moving production elsewhere. Rising production costs and labor expenses have made China less appealing. Coastal regions in South China, despite their efficient supply chains, now face skyrocketing land and labor costs. Consequently, many Japanese factories have relocated to Southeast Asia and Africa.
Yet, the Chinese market remains crucial for Japanese home appliance firms. With its vast population, there's immense room for growth in virtually every household product category. However, the rapid rise of domestic Chinese competitors has squeezed the space available for Japanese brands.
Japanese electronics once dominated the market with groundbreaking innovations, but the barriers to technological advancement have eroded. Collaborative networks and partnerships have rendered their proprietary technologies less relevant. This shift has allowed Chinese manufacturers to surge forward.
Let’s explore how some of these iconic Japanese brands are reshaping themselves. Take Toshiba, for instance. Known for pioneering the world’s first incandescent lamps and washing machines, it once led in global electronics. Now, its white goods division has been acquired by Midea Group for ¥53.7 billion, securing 83.7% of shares. Midea also gained long-term global branding rights, over 5,000 patents, and distribution channels across Japan, China, and Southeast Asia.
In the black goods sector, Toshiba partnered with TCL in 2010 to form Toshiba Video Products (China). Initially, Toshiba held a 51% stake, but after years of restructuring, TCL now controls 70%, while Toshiba retains 30%. Despite stopping local TV production, Toshiba’s R&D remains based in Japan.
Sharp, another century-old giant, was rescued by Hon Hai, which acquired 66% of its shares for ¥388.8 billion. This infusion of capital and Sharp’s tech expertise smoothed the path for localized TV production. Sharp’s LCD TV sales surged 93% year-on-year in the first half of this year.
Sanyo, once a powerhouse rivaling Panasonic and Toshiba, met a different fate. By the 1990s, it began outsourcing production to Haier, diluting its brand value. Acquired by Panasonic in 2008, Sanyo’s operations in China shifted to a custodial model. In 2015, its mainland TV business was licensed to Changhong.
Pioneer, famed for its premium plasma TVs, transitioned to LCD production via a partnership with Panasonic. Suning Electric became its exclusive distributor in China. Yet, Pioneer’s reliance on cutting-edge technology over practicality left it vulnerable to market shifts.
Japanese companies’ obsession with perfection often slowed their pace of innovation. They missed opportunities in the digital revolution and struggled to adapt to localized demands. Poor after-sales support further alienated consumers.
However, Chinese acquisitions have breathed new life into these brands. After Foxconn’s takeover of Sharp, its extensive supply chain and marketing prowess revitalized the brand, making it the fastest-growing joint venture TV brand this year.
Similarly, Midea’s acquisition of Toshiba’s white goods division prioritized expansion in Japan and Southeast Asia rather than immediate re-entry into China. Whirlpool’s purchase of Sanyo focused on reinforcing its own brand identity.
In conclusion, the global trajectory of Chinese home appliances began with integrating Japanese brands. This serves as a lesson for Japanese firms: while their technology remains robust, outdated management practices and marketing strategies hindered their success in China. The resurgence of Japanese home appliances might depend on collaboration with Chinese entities.
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Sensen Group Co., Ltd.  , https://www.sunsunglobal.com