Sunday, September 2, 2007

Plextor Transfers Assets to Shinano Kenshi

As announced earlier this year, Plextor on the 30th of August officially transferred its optical drive business to Shinano Kenshi, an industrial group in
Japan. Sales of Plextor-branded devices will continue going forward, but the reorganization will imminently cause changes in products release and design approaches.
Shinano Kenshi takes over Plextor’s product planning, development, design, product, sales and support as a part of global reorganization and streamlining of Shinano Kenshi’s own operations. It remains to be seen whether the enlargement of Plextor’s parent company will affect Plextor’s products. and whether the impact will be positive. What can be said for sure is that products sold under Plextor trademark will remain on the market in foreseeable future.
Earlier this year it was reported that as a part of the reorganization, the production of optical disk drives (ODDs) will be reduced to “10% of the peak production levels” and Plextor will concentrate its efforts on industrial equipment and the Plextalk digital sound recording playback equipment for blind. It was also noted that the transaction between Plextor and Shinano Kenshi will not affect Plextor’s business in the USA.
“This announcement by Shinano Kenshi will have no material affect on the operations of Plextor LLC, as we already completed a corporate reorganization in North and South America last year. Our business will continue as usual,” said Toru Nakazawa, president of Plextor LLC, USA.
Due to generally high production costs in Japan, since the year 2005 producers of ODDs, such as Sony and Teac started to outsource manufacturing to third parties in South Korea and Taiwan. Foxconn Electronics has received orders from Matsushita (Panasonic) for models targeting the retail market, while Asustek Computer has started making DVD burners for Pioneer, which now only keeps in-house production for high-end models, it was reported.
ODD business is so highly competitive that NEC and Sony have formed Sony-NEC Optiarc joint-venture to develop, design and manufacture of optical drives, whereas LG Electronics and Hitachi also have similar joint-venture. That said, it is hardly a surprise that Shinano Kenshi decided to fully take over Plextor to stay in the business.

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