TOKYO (AFP) - Nikon said Monday (Oct 30) it has ceased operations at a compact camera factory in China, underscoring how picture-taking smartphones have devastated the market for digital cameras.
Tokyo-based Nikon, which is going through a sweeping restructuring to repair its finances, said it ended operations of Nikon Imaging (China) in eastern Wuxi City, Jiangsu Province, which employed nearly 2,300 people.
"In recent years...due to the rise of smartphones, the compact digital camera market has been shrinking rapidly, leading to a significant decrease in operating rate at NIC (Nikon Imaging China) and creating a difficult business environment," Nikon said in a statement.
"The company has decided to discontinue operations of NIC. Thereafter, we will begin conducting relevant dissolution and liquidation procedures," it added.
Nikon said it expected the factory closure to cost around 7 billion yen (S$84 million), but added that China will remain one of its key markets.
A rapid shift to picture-taking smartphones has torn into a camera sector dominated by Japanese firms also including Canon, Olympus,and Sony - much like digital cameras all but destroyed the market for photographic film years ago.
Smartphones have been replacing a wide range of products, from newspapers to personal computers, but digital cameras have been among the hardest-hit.
Japanese camera makers have been steadily scaling down production of compact models in recent years.
Some have used their optical know-how to move into other areas like medical equipment, while others have focused on the high-end camera market.