A succession of moves to withdraw from or scale back operations is emerging among electronic component and semiconductor-related companies with high dependence on the Chinese market, highlighting the ongoing shift by Japanese companies away from China. Meanwhile, concerns about China risk remain over the medium to long term, and supply chains may be reorganised further.
Against the backdrop of political and historical developments in China, Japanese companies are increasingly reviewing their dependence on China. Leading Japanese companies including Konica Minolta, Canon, Mitsubishi Motors, Isetan and Nippon Steel have begun scaling back or withdrawing from the Chinese market.
Electronic component manufacturers and semiconductor manufacturing equipment-related companies in particular often have a high degree of dependence on China, and many generate a certain proportion of their sales there.
In the semiconductor sector, some believe that Japanese companies' manufacturing equipment and electronic components are essential to China's supply chain, while others point out that the short-term impact will be limited.
Over the long term, concerns about China risk will remain, and moves to diversify and reorganise supply chains across regions outside China may gain momentum. Fast Retailing's Uniqlo is pursuing regional diversification by shifting production bases to Vietnam and Indonesia.