Japan's Sharp Corp. raising production in RI
By Hendarsyah Tarmizi
TOKYO (JP): Japan's Sharp Corporation is preparing to open and build more factories in Indonesia to tap its growing market for consumer electronics.
Corporate Senior Executive Vice President Yutaka Wada said here last week that the company would open a semi-conductor factory in Karawang, West Java, later this month, and that the corporation was building other factories to increase production.
He said this was part of the company's strategy to strengthen its foothold in Indonesia.
"Indonesia, with its vast growing population, is really promising for our electronic products," he told Indonesian journalists visiting Sharp's High Technology Hall in Makuhari on the outskirts of Tokyo.
Wada said that opening new production facilities in Indonesia and other Association of Southeast Asian Nations' (ASEAN) countries was the only way that the company could compete with other electronics giants, especially when the region adopts its free trade agreement in 2003.
He said that Sharp, which has factories in most Asian countries including Indonesia, Malaysia, Thailand, the --Philippines, Hong Kong, Taiwan and China, could only compete with other major electronics manufacturers if it offered lower prices.
"It means that our production should be more efficient. By having production bases in all ASEAN member countries, we will be able to cut operational costs significantly," he said.
Wada acknowledged that Sharp's production capacity in Indonesia was much lower than its capacity in Malaysia and China, but he said the company was going to do more in Indonesia.
Sharp's Indonesian operations are controlled by its subsidiary PT Sharp Yasonta Indonesia. It established its first TV and refrigerator plant in Indonesia in 1994. Last year the company invested Rp 30 billion (US$12.8 million) to increase production in Indonesia.
Its annual production of color television sets was, for example, increased to 350,000 units from 220,000 units, while its annual production of refrigerators was increased to 300,000 units from 260,000.
Sharp also opened a new factory last year to produce 2,000 washing machines a month.
Ryoichi Tominaga, the general manager for regional marketing, said that Sharp's new semiconductor factory in West Java was expected to support the company's TV factories in Indonesia and other countries of Southeast Asia.
He said the company's production bases in Asia were designed so that their activities would complement each other.
"Semiconductors to be produced in Indonesia will, for example, be also sold to other Asian production units. The Indonesian unit will, on the other hand, also use components produced by other Asian subsidiaries to produce color TV sets, refrigerators or washing machines," he added.
New
Tominaga said that Sharp's presence in Indonesia was relatively new, considering that the company had operated factories in Malaysia for nearly 24 years.
In Indonesia, Sharp has three subsidiaries: PT Sharp Yasonta Indonesia for manufacturing, PT Sharp Yasonta Antarnusa for sales and PT Sharp Semiconductor for manufacturing semiconductors.
Sharp Yasonta Indonesia's annual sales are expected to rise 30 percent this year to Rp 235 billion (approximately US$100 million) from Rp 180.5 billion in 1995.
Sharp is more active in Malaysia. There it has five manufacturing units and one sales unit.
In Malaysia, most of its output is exported. But in Indonesia nearly 90 percent of its output is sold to the domestic market.
Established by Tokuji Hayakawa in 1912 as a pencil producer, Sharp Corporation began manufacturing and marketing crystal radio sets in 1925.
In 1953, the company started developing and mass producing television sets to coincide with NHK's early TV broadcasts in Japan.
Sharp has become one of the world's electronics giants, controlling 14 percent of the Japanese TV market, according to Minoru Fujiwara, Sharp's director for international marketing.
He said Panasonic lead the Japanese TV market, with a 24 percent market share. Toshiba is second, with a 16 percent market share, and Sharp is third with a 14 percent market share.
Hayakawa said that Sharp was the largest producer of TV sets with Liquid Crystal Displays (LCD). It has captured around 90 percent of the world market for LCD TV sets.
"Sharp is the only LCD producer in the world. Sony and other producers which use LCDs for their television sets buy the LCDs from us," he said.
The price of LCD TVs is around six times that of conventional television sets but in Japan they are becoming more popular despite the price.
He said that 10.4-inch LCD display TVs cost around US$1,200 each, compared to $200 for conventional television sets of the same size.
Sharp is also renowned for its success in developing personal information tools.
Sharp recently introduced the new ZR-3000 "Zaurus" personal information instrument, which offers powerful PC connectivity, software and communication applications.
Mainichi Shimbun recently launched a news service using 305- gram "Zaurus" personal organizers. The news is fed manually to the instrument via a PC using a modem connected to a telephone line.
Other new products include the PC-W100 series of multimedia color Liquid Crystal Display (LCD) notebook computers, the world's first notebook PCs equipped with wide-screen 1,024 x 600- dot LCD displays.