Nikon raising prices as much as 15% February 1st

Started Jan 20, 2009 | Discussions thread
Eamon Hickey
Veteran MemberPosts: 3,144
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canon and currency squeezes
In reply to Thom Hogan, Jan 23, 2009

Thom Hogan wrote:

we don't have to buy any nikon products - canon raising prices?

Canon seems less organized on this than Nikon. They've done a few
things in the pricing realm, but nothing unilateral. That may reflect
the fact that they want to regain market share they lost to Nikon.

In my experience, Canon has treated currency squeezes like the current one as a competitive opportunity.

When the dollar last dipped to 90 yen, in the mid 1990s, the camera industry went through dramatic convulsions -- this was the wound that an already weakened Minolta never recovered from, in my opinion, and everybody else suffered mightily as well. And the camera business itself was much less healthy and profitable than it is now. What is happening now, so far, pales in comparison to what happened then (large workforce reductions, facility closings, etc. etc.)

Still, despite the slack camera market, Canon kept their price increases to about half what Nikon and other camera makers did. Nikon's prices went up about 20% or so during that time (in three separate price increases) and Canon's went up only about 8-12% (and in only one increase, if I remember correctly). Canon's increases amounted to far less than the gain in yen value (which was from 20-30%, depending on the time frame you use.)

In other words, Canon quite deliberately took advantage of tough economic conditions, using them as an opportunity to batter the competition. Their strong financial position and superior manufacturing efficiency allowed them to do this. They made little or no money in cameras for a year or two, but gained a lot of market share. (Nobody else made money in cameras those years either.)

So just throwing that perspective into the mix. Whether they will try the same trick now, I don't know. Nikon, at least, is a far better managed and more efficient company now than it was in 1995, so it will be harder to prey on. And the Nikon folks certainly remember what happened in 1995. But Canon is a tough cookie, and pricing is their game; nobody in the camera industry plays it better. So we'll see.

Tangentially, I fear for Pentax these days.

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