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Japan's steelmakers see profit dive 80% in April-June quarter

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© 2012 AFP

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Major Japanese steelmakers suffered as their Chinese rivals ramped up output, driving steel prices sharply lower across Asia and denting the profitability of Japanese exports, the paper said.

Turn about is fair play I'd say. Japan did pretty much the same thing to the US steel makers back in the 70's and 80's as well.

While "profits" may have plunged 80%, they still are making a profit nothing to complain about given the current economy. They should be happy.

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While "profits" may have plunged 80%, they still are making a profit nothing to complain about given the current economy. They should be happy.

Yeah but if the trend continues, you will see people getting laid off.

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Maybe the steel industry and construction companies need to go back to the artificial price manipulation on bridge building contracts to save the industry. China will do anything to get the bid for steel. Beware, Japan.

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Deindustrialization is on the cards for Japan...

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Turn about is fair play I'd say. Japan did pretty much the same thing to the US steel makers back in the 70's and 80's as well.

Yubaru -- you beat me to it. Japan Inc. is getting a taste of is own medicine -- from the Chinese, Korean and others. And since Japan does not have a history of entrepeneurism or high-teh innovation of late -- like Silicone Valley -- which pulled the U.S. out of its down period, it will be interesting to see if/how Japan Inc. adapt.

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YubaruJul. 23, 2012 - 07:19AM JST

Turn about is fair play I'd say. Japan did pretty much the same thing to the US steel makers back in the 70's and 80's as well.

Superficially working within the steel industry in Japan for the last 4 years and coming from a family from Teeside, it's like I am witnessing a classic case of deja vu. I don't think the steel workers of Japan really know what is going to hit them in the very near future.

The final demise of British Steel in the early 1980s left scars which still have not been healed in the communities who depended on them,

I give it another 2 or 3 years, before previous profits have been finally used up, that JFE either closes one of its 2 eastern Japan plants. Of course they could start selling off some of the large amounts of real estate they own, but that will only delay the inevitable.

Steel making in Japan is an industry of the past,

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Ah yes, the Japanese YEN goes way up, the Chinese Yuan is controlled by their communist regime, then we should be surprised that no body in their right mind wants to buy over priced Japanese steel?? Also the South Korean Wan is very cheap now against the Japanese Yen, so Samsung etc..are also making money hand over fist!

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It will be interesting to see how the japanese will compete with the Chinese. The US and European countries have suffered the same from Japan in the past, and they kinda survived. Is the new japanese generation able to?

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Elbuda MexicanoJul. 23, 2012 - 09:18AM JST

Ah yes, the Japanese YEN goes way up,....the South Korean Wan is very cheap now against the Japanese Yen, so Samsung etc..are also making money hand over fist!

Samsung doesn't make steel and the same old, 'Japanese Yen is too high', is all bull.

Japanese steel has never been cheap. Apart from the domestic market, where buying japanese steel was a compulsion imposed on companies, the attraction of Japanese steel was in the high quality. In price range, it has never been able to compete with Korean steel.

The high yen is actually an advantage because ore is priced in dollars.

What has changed is that the Koreans and Chinese now make just as good quality steel as Japan. Added to this is the Chinese government's copying of the Japanese neo-mercantilist model of excluding foreign suppliers from government projects.

The fault squarely lies with Japan trying to keep its large products manufacturing economic model in place, when it should have moved on to another economic model, and has very little to do with the Yen.

Even Germany long gave up on domestically producing its own steel

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Can we expect to see rising tax on steel imports to protect Japanese steel producers?

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Michael BonincontriJul. 23, 2012 - 10:54AM JST

It's not the same at all. in the 70's and 80's Japanese companys produced higher steel quality than elsewhere in the world though Japaneses salary was similar to a German steel-worker.

It;s exactly the same, if you take into account that the Japanese were selling their steel cheaper abroad, than they were selling it domestically. Japan steel in the 60s and 70s was a classic case of dumping.

Also your wage parity is wrong because the base salary plus bonus made the japanese steelworker's salary similar to his US European counterpart, but actual payment per hour, when unpaid overtime was included, made his salary 70% of US European counterpart and during the OIl Shock of the early 70's no bonus was paid for 3 years.

As others have said..... Japan is getting what it gave others. Unfortunately, as with the 60s and 70s, it;s the worker's standard of living whch suffers. I;m glad the Japanese are getting to feel how we felt and maybe they;ll also understand that the negativity towards japan then, had little to do with race and war, and a lot to do with destroying jobs and people's standards of living, which they had struggled for 80 years or more to rise.

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