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Canon to close Zhuhai factory in China

Image: Canon.
1 minute read
Image: Canon.

The factory, which employs over 1300 people, is closing with Canon citing chip shortages, the global Coronavirus pandemic and a reduction in digital compact camera demand.

The story has been subject to a few updates, as well as the usual rumour mill, but now Canon has confirmed that the Zhuhai factory will be closing. The facility apparently manufactures camcorders, compact cameras, and lenses, and is a substantial installation, employing over 1300 people. For perspective, during 2020 the facility produced 12.29 million lenses, 1.03 million digital cameras, and 94,000 video cameras. During the same year it had made investments with $220 million USD. The Zhuhai factory is Canon's only manufacturing plant in mainland China, so its closured marks the end of manufacturing in the country.

Whilst such a closure is major news, with the declining market for compact cameras in the face of direct competition from smart phones, along with the global chip shortage, it isn't wholly unsurprising. However it's the size of this facility that makes this closure notable. The factory, which is located in Guandong province in southern China, has been in existence for 32 years, having being established in 1990. Canon owns an 83.1 percent stake in the factory, whilst Canon China owns the rest.

According to National Business Daily, digital camera shipments have dropped 93%, falling to below 10 million from around 120 million over a period of 11 years. The pandemic has also caused huge issues, with data showing global digital camera shipments as a whole totalled only 8.89 million during 2020. 

Canon told DP Review, "It is true that we are planning to cease manufacturing at Canon Zhuhai. With the guidance of the Zhuhai city government and High-Tech Zone authorities, discussions are currently underway with Canon Zhuhai employees, suppliers, and other affiliated parties. As these discussions are currently in progress, we cannot yet disclose any information. Further announcements will be made if and when deemed necessary."

Clearly there is more to be revealed about the decision, and no closure date has been announced, so watch this space.

Tags: Business News