This Week in Imaging: Printer/MFP Industry Taking Hard Hit in China
It was a slow news week in the document-imaging industry, but one thing sure stood out – the printer/MFP market is floundering in China.
The news came as IDC released its latest research showing that the global printer/MFP shipments fell 7.9 percent year-over-year, for a second quarter of decline. However, the big decline was mainly in China, with shipments down 20.5 percent year-over-year, followed by Western Europe, with shipments down 11.6 percent year-over-year.
Meanwhile, in the Asia-Pacific (excluding Japan) region, only 6.9 million printers were shipped in the third quarter, the lowest number of printers ever shipped in the post-pandemic era.
The bad news comes as various sources continue reporting much-slowed economic growth in China this year. That’s resulted in credit-rating agency Moody’s this week downgrading its outlook on the Chinese government’s credit rating to negative.
The reasons for the slowdown aren’t exactly clear. The country had one of the strictest COVID-19 pandemic policies in place, and many of its factories and shipping ports were forced to shut down during the pandemic, affecting supply chains around the world.
But the government lifted those policies last year, and the country has returned to normal pre-pandemic economic activity. That should have resulted in a strong recovery, but it hasn’t. Many have attributed the slowdown to things like problems in the real-estate industry and slumping exports (additionally, those U.S. tariffs put in place by the Trump Administration are still in place).
What’s striking is that for the printer/MFP industry, China always seemed a reliable market for printers. Indeed, back when Lexmark was sold to Ninestar Corporation of China a few years ago, one of the advantages was said to be that Ninestar would open up the big Chinese market to Lexmark printers. But that market seems to be in a decided slump. This slump is also backed-up by printer companies’ latest financial reports, with virtually all reporting lower revenue due to lower revenue from China. We should also consider that during the pandemic, Chinese office workers, like others, had to adapt to using digital, electronic methods as alternatives to print, reducing their reliance on print overall.
The good news is that in the third quarter, there were some regions of growth – surprisingly, with the U.S. topping the list at 7.9 percent year-over-year shipment growth. But for China, the road back to strong growth for printers will likely take some time.
This Week in Imaging
Market Research and Reports