Toshiba to apply expertise to medical equipment
Toshiba Corp. was Japan’s first company to produce color TVs 55 years ago. However, the fierce price competition with overseas manufacturers in today’s home electronics market makes it difficult to turn a profit.
Toshiba sees the health care industry as a way to utilize the technological strengths it cultivated in the electronics business.
The Yomiuri Shimbun spoke with Toshiba president Hisao Tanaka, 64, about his company’s business strategy. The following are excerpts from the interview.
“We decided to abandon inhouse production of thin LCD televisions for overseas markets. Factories in the United States, Europe, China, and Japan have been closed and sold off but even after reducing fixed costs to this extent, we don’t expect to break a 5-percent profit margin on sales.
“Overseas, we will shift to the licensing business, allowing overseas companies to use the Toshiba brand for their televisions. Domestically, high value- added products — our forte — such as 4K televisions have garnered praise, and we will continue to produce them.
“We’ve placed our hopes on the health care industry as a mainstay for new growth. Things like the combination of the chronically low birthrate and our ageing population, along with population growth in developing countries, have become issues around the world.
“The image processing technology we cultivated through developing televisions can also be applied to medical monitors, so television engineers are being reallocated to the health care division.
“Our strength is that we have deeper relationships with medical institutions than other companies, and we understand things like the permissions and licensing systems of countries around the world.
“We have the fourth- highest global market share for imaging diagnosis equipment such as CT and MRI scanners, and we export to over 130 countries.
“For the fiscal year 2017, our goal is to have our current sales more than double to 1 trillion yen (US$8.41 billion). To acquire technologies we do not possess and achieve this goal, we will actively pursue mergers and acquisitions, as well as partnerships with other businesses.
“In the energy field, one of the mainstays of our business, we will devote more effort to hydrogenrelated technologies. Although it is still expensive, it is a groundbreaking, clean energy source.
“We have high expectations for the 2020 Tokyo Olympic and Paralympic Games as an opportunity for our public relations.
“To take full advantage of the Olympics, we’ll need to have achieved a certain level of installations in commercial buildings in 2018.
“Research on supplying power for buildings such as condominiums is ongoing. We aim to establish overseas operations as well, and to expand the scale of the business to more than 100 billion yen as quickly as possible.
“We don’t believe that all of these new businesses will flourish, but we want to increase our employees’ motivation to produce new value.”