End of an era: Canon closes China printer plant as Japanese brand loses to local rivals

Japanese imaging technology giant Canon has shut down one of its major printer production facilities in mainland China, underscoring the growing clout of domestic brands in the country’s printing market.\nA visit on Thursday by the Post to Canon Zhongshan Business Machines, in Zhongshan city in the southern Guangdong province, revealed little activity. The car park was nearly empty, while a dozen employees strolled outside the office building.\nA worker said production had halted late last month, with remaining staff tasked with “handling the aftermath”, including severance payments and supplier settlements.\nThe company, which specialises in laser printers, told employees the shutdown was attributed to a shrinking market and intensifying competition from rising local brands, according to local media reports. A public relations manager from Canon China said the plant “ceased its production and business operations on November 21” primarily due to a “shrinking” laser printer market.\n\nThe compensation was generous, workers said. For example, one employee, who worked at the plant for 10 years, expected to receive about 200,000 yuan (US$28,290) in severance. Based on the company’s disclosed average monthly pay of 4,800 yuan in the first half of 2024, the payout equated to nearly 43 months’ salary.\nCanon’s skilled workforce has already attracted attention from recruiters. Fliers were distributed outside the factory gates by local electronics manufacturers seeking to hire experienced staff suddenly available on the market.\nTwo workers said they were not surprised by the closure, noting that the company had been downsizing for years. The Zhongshan plant had more than 1,000 employees when it closed, down from around 10,000 during its peak.\nEstablished in 2001, the Zhongshan facility expanded so rapidly that it relocated to the current site in 2012, absorbing production capacity from neighbouring Zhuhai city. The factory was notable not only for its production lines but also for amenities that included sports facilities, a cinema, a reading room, and dormitories equipped with air conditioning, washing machines and televisions. Workers said they were allowed to continue living there free of charge until December 21.\nThe closure marks more than the end of a single plant. It represents a turning point in Chinese manufacturing, where local brands are widely seen to have not only caught up with foreign rivals but have also begun to dominate the home market.\nA search of laser printers on Alibaba Group Holding’s Taobao marketplace on Thursday recommended brands like Huawei, Lenovo HP and Deli, a Chinese stationery maker, with Canon listed 11th. On JD.com, another major shopping site, Canon was listed 25th. Alibaba owns the Post.\nCanon’s printing business, its largest revenue stream, is facing a downturn. In the third quarter, printer sales dropped 1 per cent to 611 billion yen (US$4 billion), the only segment that declined, as overall sales rose 2 per cent to 1 trillion yen. Canon cited in its 2024 annual report “a decrease in demand for laser printers mainly in China” while inkjet printers also struggled in weak market conditions.\nBeyond Zhongshan, the company operates factories in Shenzhen, Dalian in the northeastern Liaoning province and Suzhou in the eastern Jiangsu province for printers and printing accessories. Overseas, its printing production lines are located in Vietnam and Thailand.\nWhen asked about plans for the other factories, Canon China’s public relations manager said the company “would like to refrain from commenting on other plants”.\nThis is not Canon’s first retrenchment in China. In 2022, it shut down a digital camera factory in Zhuhai, also citing weak market demand.\n