Canon is deliberately moving manufacturing back to Japan, according to the Nikkan Kogyo Shimbun a change that will affect office products devices more than other divisions. As Canon’s product mix – like that of most camera makers – is shifting up-market, producing higher-priced and higher-margin goods in the face of supply chain limitations, it makes less sense to keep paying for low-end, mass production infrastructure, like factories in China.
A major influence in these decisions for worldwide conglomerates is the price of the home currency. The Japanese Yen has been relatively depressed versus other currencies for a significant period of time, a deliberate policy by the Japanese government to encourage manufacturing at home and exports abroad.
Canon’s experience with foreign manufacturing caused them to better appreciate local political stability and higher worker education levels. The higher costs of that labor may prove a smaller proportion of product costs given the increased sophistication and corresponding costs of the hardware components used.
The move is the opposite of Nikon’s recent factory closures, moving most manufacturing to Thailand.