Update: July 2017 CIPA data added
The July figures show a downturn in production, but this is not unexpected and is probably due to summer shutdowns. Nothing here to give an indication of future growth. The next few months should show just where the industry is heading.
The rise of the digital camera in the 21st century has been a remarkable success. However, as with virtually all technology, something comes along to cause a reversal back towards either the norm or a complete failure. Of course, we are talking about the stand-alone digital camera. The cause of the failure in this regard is the advent of the Smartphone, not photography. Today, something approaching 98% of all photographs taken are not with a standalone camera but by another device, smartphone or tablet. So little wonder we see the chart below of annual digital camera production from the main Japanese companies as collated by CIPA Japan.
Take-up of the digital camera was quite remarkable from 1999 up to the peak of 2010 with just a blip caused by the global financial crisis. A rise of 2,408%. Since then the unit production has fallen back considerably. Production in 2016 may have seen a near flatline in figures but for the major earthquake that interrupted production and cost the industry dearly. The question is, when will we see the bottom of the market and the possibility of any growth in this product?
During 2016 many popular cameras were in very short supply. Those buyers who were disappointed with not being able to purchase may well have opted to just use a Smart device and they may not return to the stand-alone camera in the near future. Other issues such as rising prices due to the strength of the ¥en have not helped sales. There are core markets such as the Professional and Enthusiast that will persist. Will the industry simply revert to those markets with niche, high-value products? If so, will the market be large enough to still attract the big corporations like Sony and Panasonic?
Monthly Unit Production by Camera Type
Camera production through the years usually follows a regular pattern. Camera production peaks in spring and autumn and is lowest through winter. During 2016 however, the Kumamoto earthquakes caused a major disruption of camera production through the summer months and delayed the peak from the usual October to November. Since then, production has been maintained at a higher than usual level up to May 2017 to make up for some of the last years lost production. This has led to an apparent leveling out of production moving average over the last few months. That has now moved into an upturn, at least for Compact type cameras.
Looking closer at the 12-month moving average we can see a reasonably smooth decent with 2014 and 2016 being weaker than usual. This decline is almost entirely due to the Compact fixed lens type cameras, with a small decline in DSLRs as more Mirrorless cameras are produced.
As of May 2017, overall production trend has started to rise again and that is certainly a relief to the industry. This, of course, could be just making up for last years production weakness, on the other hand, it could signal the end to the long decline in camera units produced.
Monthly Production Total Value by Camera Type
The Total market value has suffered a similar fate but with slightly less magnitude due to the biggest collapse being at the cheap end of the market. So as low cost point-and-shoot, the mass market, has been overtaken by other multi-function devices the stand-alone camera has drifted up in value to be a more expensive product. These values are in ¥en, and so the variable, and sometimes erratic, exchange rate will be responsible for some of the movement we see here.
As of June 2017, total market value of Compact cameras is rising. Mirrorless are trending up but with a downward correction in June 2017. DSLRs are flat lining but with an upward correction in June 2017. The next few months will determine if this is the bottom or just a pause before a further descent. Most camera manufacturers are still predicting lower sales in 2017 than 2016.
Monthly Production Average Unit Value by Camera Type
Average camera value has been trending up for most of the last few years but this year overall has flatlined. June 2017 has seen a correction in the average camera values. Compact and DSLRs are up whilst Mirrorless takes a fall. This is likely due to the mix of cameras that have been scheduled for production during the month but should also feed through to the camera shipments in future months.
These monthly values fluctuate erratically but the 12-month moving average gives a better indication of average cameras value. Some peaks can be directly attributed to the launch of certain models, such as the spike in Mirrorless value in late 2013. This is most likely to be due to the launch of the Sony A7/A7r models. Also, the recent launch of the Sony Alpha A9 can be seen here in the rising value. Will the launch of the Canon 6D MkII help DSLRs rise again?, appears so.
The mass market for stand-alone cameras is well and truly over with little signs of any potential future expansion in the overall market. Production of DSLRs is being eroded by better Mirrorless cameras coming through. Enthusiast DSLRs are lower priced than their Mirrorless counterparts and this may help to fend off the Mirrorless charge.
With some good Premium Compact cameras for sale the Compact is making a return to growth in both numbers and price. How long for we will have to wait and see. The overall production figures have started to rise and that is a welcome sign for the industry that has suffered such a large decline. We will need to see a few more months of data before we can conclude that this will be sustainable or just a pause before further contraction.