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9/11

Thai floods, yen affect Japan Inc

Tuesday, November 01, 2011 - 01:50

Nov. 1 - Japan's biggest corporations are facing an ever tougher fight to keep up with their nimble Asian rivals as the soaring yen and Thai flooding hit Japanese manufacturers. Toshi Maeda reports.

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Japan's big corporations are facing a tough fight to keep up with their Asian rivals as a soaring yen and floods in Thailand are forcing many Japanese manufacturers to report record losses and slash jobs. Even after Tokyo's yen-selling intervention on Monday (October 31), the yen quickly rose back against the dollar towards the 78 yen level. In an attempt to sidestep the rising currency, many Japanese firms have shifted production to Asia, namely Thailand. But their production shift has backfired due to the recent flooding. The Thai disaster has forced many firms to close plants that are either under water or lack necessary parts -- in an echo of the supply chain disruptions following the March 11 earthquake and tsunami that devastated northern Japan. Japanese automaker Honda has been hit the hardest by both disasters this year, now suffering direct damage at its Thai car factory in the Ayutthaya (eye-you-TIE-ugh) industrial estate. A combination of the Thai flooding and a strong yen has also forced Japanese electronics component maker, TDK, to slash 11,000 jobs, or 12 percent of its workforce. Game giant Nintendo, which generates 80 percent of its sales overseas, is expecting to make its first annual net loss ever. Electronics maker Panasonic, meanwhile, has cut its annual TV sales forecast by one-fourth, and warns it may report its worst annual net loss in a decade. Panasonic plans to cut 17,000 jobs and close up to 70 plants. Toshi Maeda, Reuters.

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Thai floods, yen affect Japan Inc

Tuesday, November 01, 2011 - 01:50