Japanese Firms Seek Relief in Overseas Operations
By wchung | 25 Mar, 2026

Over half of Japan’s 105 leading firms plan to counter the strong yen, power shortages and falling share prices by expanding operations overseas, according to a Kyodo News poll.

Fifty-five of the firms expect to boost overseas production to cope with the increasingly more difficult economic conditions, confirming fears that continuing harsh conditions will accelerate the hollowing-out of Japan’s domestic industries.

Toyota Motor Corp., Honda Motor Co., Nissan Motor Co., Sony Corp. and Nippon Steel Corp. were among the firms whose top managers responded to the survey which was conducted from late July to early August.

Fifty-one companies saw a slow or steady expansion in economic activity while 13 said the economy is slowing either slowly or substantially. Forty-one firms said the economy is at a standstill.

The economy should improve over the next six months, according to 70 firms. Only four called conditions grim. The remaining 27 expect economic conditions to stay the same.

Of eight negative factors, the yen’s appreciation was cited by 54 firms as the main cause of their pessimism, while 34 put the blame on the U.S. economic slowdown.

A persisting electricity supply shortages due to the shutdown of nuclear power plants and the subsequent freeze on restarting them were cited by 34 firms as the biggest factor behind their pessimism. Weak domestic personal consumption was picked by 27 firms.

Fifty firms said sales and profitability would be depressed either sharply or mildly if the dollar remains below 80 yen. The exchange rate would have little impact on their business, according to 37 firms.

The range of the yen-dollar exchange rate needed to support the current level of domestic operations and workforce is 90-100 yen range, according to 27 firms and 85-90 range according to 21 firms.

Thirty-one firms felt utilities should restart nuclear reactors once they clear the government’s safety checkup to alleviate the worsening power shortage. Ninety firms said they are cutting back on power consumption by curbing the use of air conditioning and lighting to help cope with the power shortages.