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No. 351, November 1998

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Japanese Companies in the US


Digital television-capable PCs will arrive in stores sometime during the first half of 1999, thanks to the joint efforts of MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. and COMPAQ COMPUTER CORP. The consumer electronics giant developed a tuner-decoder that receives and decodes terrestrially broadcast digital TV signals and displays them on a PC monitor. The world's top PC vendor will build the device into some of its models, although the high cost of the board -- expected to be more than $800 initially -- could limit sales of the new PCs. MEI's Secaucus, New Jersey-based PANASONIC INDUSTRIAL CO. subsidiary plans to market the MATSUSHITA ELECTRONICS COMPONENTS CO., LTD.-made tuner-decoder board to other PC manufacturers and to broadcasters and content developers on an OEM basis.

Home theater-type TV sets keep getting bigger. SANYO ELECTRIC CO., LTD. is marketing a 70-inch rear-projection unit. The Big Show Date can handle high- definition broadcasts as well as standard-definition programming. Because of the set's steep price -- roughly $24,600 -- Sanyo expects to sell only about 100 units a month.

U.S. sales of digital video disc players are still limited, totaling an estimated 1 million units in 1998, but more makers are moving into the market. Among the latest is VICTOR CO. OF JAPAN, LTD., which released two DVD models at the end of November that had been introduced earlier in Japan. JVC is projecting sales of 150,000 DVD players in the United States in 1999. Achieving that forecast is key to its goal of winning 10 percent of the world market in the near term.

Industrial control systems manufacturer GE FANUC AUTOMATION NORTH AMERICA, INC. acquired TOTAL CONTROL PRODUCTS, INC. for just under $100 million, plus the assumption of $20 million in debt. Melrose Park, Illinois-headquartered TCP, which is in the same business as GE Fanuc Automation, supplies such products as input/output devices, graphic operator interfaces and open connect hardware and software for factorywide control systems. It earned $4.1 million on sales of $60.6 million in its last fiscal year. One of the company's shareholders was DIGITAL ELECTRONICS CORP., an Osaka maker of electronic control systems. With the buyout of its 4 percent TCP share, Digital Electronics plans to set up a wholly owned U.S. subsidiary in the spring of

Charlottesville, Virginia-headquartered GE Fanuc Automation is the result of a 1986 partnership between FANUC LTD. (45 percent), the world's dominant maker of numerical controls for machine tools, and GENERAL ELECTRIC CO. (55 percent). The latest phase of YOKOGAWA ELECTRIC CORP.'s year-old-plus turnaround strategy for its North American industrial automation business (see Japan-U.S. Business Report No. 342, March 1998, p. 4) involves the integration of its Newnan, Georgia manufacturing operation, YOKOGAWA INDUSTRIAL AUTO-MATION AMERICA, INC., with its sales arm, YOKOGAWA CORP. OF AMERICA, also based in Newnan. The resulting organization retains the name of the sales subsidiary. To better exploit opportunities in the world's largest industrial automation market, YCA will expand direct marketing and sales by distributors by hiring more people. Its parent also will transfer systems engineers and marketing specialists from Japan to the Georgia company. Yokogawa Electric is looking for North American sales of roughly $250 million in FY 2000, or 50 percent more than current annual revenues.

An exchange rate of ¥121=$1.00 was used in this report.

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