Rumors abound that the prosumer and mirrorless camera launches by Nikon have been postponed. I'm not sure that "postponed" is the best word to describe what's happened. News out of Japan shows just about every vendor of products--and not just electronics products--is scrambling to secure supply chains and schedule around power issues. We're in that "unknowns we don't know" period (yes, I'm channeling Rumsfeld today). The electronics companies in Japan still aren't sure what they will and won't be able to produce in the near term.
What we do know is that Nikon will announce their full year results next week. The fact that they didn't change their advisories to investors tends to say that "up through March 31 nothing changed from what we estimated three months ago." Put another way, the earthquake hit on March 11th, and Nikon would have been in "inventory count mode" by March 24th, so the approximately two weeks in between apparently didn't meaningfully change their numbers.
But Nikon's numbers are certainly changing now. The already widespread product shortage in the US has become wider. NikonUSA scaled back their instant rebate program and cancelled a chunk of their coop program, including a critical Mother's Day flyer that apparently got printed but was sent to the recycler instead of distributing it.
Here's the thing: NikonUSA has been living off the frequent local advertising that centers around the instant rebate program. It's efficient. It drives customers into stores, keeps the stores focused on supporting Nikon sales and keeping store inventories up, and small changes in those published rebates have been micromanaging inventory well. Without enough new inventory, without the coop program being active, and with other companies like Olympus and their US$399 E-PL1 Mother's Day promotion, most of the dealers I've talked to are already noticed a drop-off in their Nikon sales in April.
Indeed, it's gotten to the point where we're about to lose a few local dealers who were running on thin profit margins. Even though prices are pushing back up at the retail level, that isn't useful to a dealer on the edge if they can't quickly replace inventory they sell.
One problem is that the Japanese companies all seem to be sending the same message to subsidiaries: "stop pushing new products at discounts because we don't know when we can replace your inventory." Sony's rebates, for example, end in the middle of this month in the US, and it's unclear if they'll extend them again. Even auto dealers are hearing the same thing. All it takes is one or two parts that are sourced in Japan that are under constraint (or completely unavailable due to a loss of supplier) and an entire product's production suddenly is in jeopardy. Even the Thailand and Chinese manufactured products Nikon sells, including Coolpix, have parts sourced in Japan, so offshore manufacturing doesn't necessarily solve the problem short term.
Fortunately, some of the "unknowns that we don't know" should become at least "unknowns that we know" very soon. Nikon's two big product lines, semiconductor equipment and imaging products, are both highly affected by the quake and its after effects, and the local business press knows it. Nikon will not manage to get through next week's press conference and business press meetings without answering some key questions about production in this and next quarter. I don't expect that news to be good. The current quarter forecast is going to be down, probably significantly.
One sense I get from my contacts in Japan is this: "if we can just get through summer things will get much better." This sentiment relates to the (current and) impending power crisis as the summer months bring additional power demands from air conditioning needs. Recently, TEPCO published new figures that show the shortfall in power supply won't be as bad as originally predicted. But it's still a significant shortfall, which means rotating blackouts. Semiconductor fabs, glass foundries, even a number of metal parts plants, all have significant warmup and shutdown times that'll make even short power cuts into much longer ones.
I don't expect full clarity next week, only a partial lifting of the fog. We'll get some sense of how badly the quake affected Nikon. We'll get a little sense of whether any additional products are likely in the current and next quarter. We'll get some comments about what Nikon is doing to deal with the problems the quake caused.
One final point: May is not a month that Nikon announces new products (Nikon otherwise tends to announce products a week after a quarterly financial report). It's very rare that Nikon announces something in June. I'm not expecting any product announcements before August at this point, but if we do get a product announcement in this period, it will almost certainly be a product whose launch was disrupted by the quake. There are only two products that could be: Nikon's mirrorless camera, or the D700 replacement, and the latter seems unlikely to me.
I don't mean to put everyone in a downer mood today. But let's be realistic. The quake and tsunami hit every Japanese business from mom-and-pop parts suppliers you never heard of all the way up to Sony and Toyota, two of the manufacturing leviathans of Japan. It's going to be awhile before things return to normal and all the "unknowns become knowns."