I probably should have counted all the times that the camera industry said “supply chain issues” were the reason their products were unavailable in recent years. Fujifilm’s President, Koji Matsumoto, just gave another interview in Japan where he again raised the issue.
The interesting thing about all the supply chain claims I’ve seen this past year is that they are specifically unspecific (oh no, I’m channeling Donald Rumsfeld again). Moreover, virtually all of the lack of supply claims came about when the company in question was asked why their latest hot product was not in stock. Older or cooler products don’t seem to have the same supply chain problems, it seems ;~).
The real answer is that everyone battened down the hatches when the pandemic coupled with reduced overall digital camera demand coincided. DSLR volume being eclipsed by mirrorless happened in the 2020/2021 time frame, close to where I predicted it would back in the mid-teens (I tended to write 2021/2022 in the late teens; my original prediction over 10 years ago was 2023).
In 2020 interchangeable lens camera shipments were reported as 67% of 2019. DSLR and compact shipments plummeted more (both about 53% of prior year results). Mirrorless shipments in 2020 were the bright spot at 74% of the previous year, but that’s still not a great number. But not many noticed as we were all much more worried about COVID than what might be happening in Tokyo.
Coupled with lockdown happening at factories worldwide in 2020, yes, supplies were even more constrained than sales. 2022 was a really good year (pent up demand happened as the pandemic released its reign on the world), but 2023 wasn’t another big step forward. Looking at just mirrorless in those years: 2022 was 131% year-to-year, 2023 was 118%. But remember, those numbers were coming back from that big drop. Mirrorless in 2019 was 4.0m units, while “all that growth” in 2022 just brought shipments back to 4.1m units.
My sense is that the camera companies battened down every hatch in 2020, and never really fully opened them again, even today. They’d rather have the problem of their latest product being out of stock than invest capital to increase capacity, which would allow them to come closer to demand. Likewise, if they weren’t investing capital, they also weren’t committing to supply orders at higher numbers. Which in turn would have suppliers not investing capital to expand, and suddenly you have a chicken-and-egg problem: which comes first, more supply orders or more supply production?
It doesn’t help that new cameras require new technology, and these days that means new image sensors and SoCs (BIONZ, DIGIC, EXPEED, etc.). While overall semiconductor fab utilization is not at historic levels, if you want new small process (SoC) or new image sensors, the story is a little different. Memory, not a problem. New near smartphone-level SoC, problem. Rumors have it, for example, that Apple alone has committed to 100% of TSMC’s smallest process size production for the coming year.
The other option here is to build inventory. Take Nikon, for instance. They seem committed to push EXPEED7 down through their entire lineup. Great, so maybe a lot of chip orders now might break a log jam. But everyone’s inventory reluctant, too, so Nikon really wants scheduled EXPEED7 delivery that matches their estimated final product delivery, which tends to be on the conservative side. The old just-in-time thing that tripped up everyone during the pandemic, despite the reduced final product demand.
Which brings us to this: “how good is Tokyo’s new product sales forecasting?” I’d tend to say “not very good.” I believe they intentionally ignore really high initial demand believing that they’ll just have a viral/hot product for awhile. I also believe that they incorrectly forecast the “tail” of sales for all their existing products, too. I won’t identify the company or product, but I was recently told that one product did really well out of the gate (and had clear backorders), but that demand tapered faster than they expected, which forced them into putting it on sale earlier than they expected to.
I spent a little time looking at retailer stocks here in the US while preparing this article. Canon RF? Pretty much every camera, even the most recent R5 Mark II, is in stock. Fujifilm XF? Bodies in stock, some body+lens kits seem to be out of stock. Nikon? All bodies seem to be in stock. Sony E/FE? Seems like everything is in stock. (By “in stock” I mean that I could easily find multiple dealers I could get a product shipped from today here in the US.)
Which brings us to another interesting angle that isn’t written about much: Fujifilm’s Matsumoto-san was actually talking about the Japanese home market, not global. It seems that the camera makers are once again putting their available inventory first into the markets where they make the most money and where there is higher demand (read: economic market strength). The value of the US dollar versus the yen and the clear economic growth in the US is one of the reasons why the American market is well stocked at the moment.
Thus, many of the “apology for not delivering product” messages you see from the camera companies tend to be regional ones. So maybe it’s not demand exceeds supply so much as it is just more micromanagement of where new products are sold as they are built. That’s not to say that there aren’t still a few products that are in short supply. The Fujifilm X100VI is still unobtainium here in the US, for instance. (Don’t worry, by the time all the other makers respond to that camera with their own versions, the X100VI will be obtainable.)
Overall, though, I don’t sense any real supply shortage that’s causing demand not to be met. It’s a completely self-goal on the part of the camera companies.
