Canon Inc. said Wednesday its camera-manufacturing unit in Nagasaki Prefecture will postpone plans to build a plant due to sharply falling demand for digital cameras.
Nagasaki Canon Inc. wanted to build the plant in the town of Hasami at a cost of about ¥15 billion. With construction work scheduled to begin next month, the plant was to start producing compact digital cameras and digital single-lens reflex cameras next December.
Canon had been expecting firm demand and its third production base for digital cameras was to have a production capacity of about 4 million units a year.
"Given the global economic slowdown triggered by a failure of a major U.S. brokerage firm, demand for digital cameras fell much more sharply than we had expected, and as such we have to review our production plan," Canon said in a statement.
"The serious demand slowdown is expected to continue for the time being," it said.
Canon said it will decide when to resume the plan after assessing market conditions.
The postponement does not affect Nagasaki Canon's job offers to 364 students graduating next spring and others at the planned factory, the company said. Those people will be hired and transferred to existing production facilities for the time being.