Yamaha Corporation of America (YCA) and its customers make beautiful music together. The North American arm of Japan's Yamaha Corporation, YCA is a leading supplier of musical instruments in the US. YCA's products include pianos and electronic keyboards, woodwind and brass instruments, guitars (electric and otherwise) and drums. Its Yamaha Commercial Audio Systems makes audio products and distributes Nexo speakers in North America. The company is also a top supplier of home audio and video equipment, including stereo receivers, home theater systems, DVD and CD players, loudspeakers, and video displays. Its other units include Yamaha Electronics Corporation and Yamaha Music InterActive.
The North American business accounts for a dwindling slice of its parent company's dwindling sales. In fiscal 2010 (ends March), North America accounted for only 14% of Yamaha Corporation's sales (down 13% vs. the year earlier period), and ranked fourth behind the Japanese market (with 53%), Europe (17%), and the rest of Asia, Oceania, and beyond (16%).
Sales of musical instruments have suffered during the global financial crisis. In the US, sales of high-end grand pianos plummeted in fiscal 2010 as a result of the housing bust and the decline in the number of music stores. Sales of lower priced keyboards began to recover in the second half of the year, but demand remained weak for wind instruments due to cuts in music education programs as a result of tight state budgets. One bright spot for the company was guitars. YCA increased its share of the acoustic guitar market even as that market contracted. Sales of professional audio equipment also declined in North America in fiscal 2010. To remedy declines in the US, the company's parent has reorganized its production structure and shuttered factories that made pianos and wind instruments. As a result of these cost reductions, YCA's operating income increased by about 23% in fiscal 2010.
Despite the recent weakness, Yamaha still considers North America a key market and is focusing on electric acoustic guitars, guitar peripherals, and drums as it seeks to grow sales here when the economy rebounds. To boost marketing of its musical instruments, Yamaha has put considerable muscle behind its artist relation efforts in recent years, such as signing endorsement deals with such recording artists as Anton Fig (from the Late Night with David Letterman show), Elton John, and Alicia Keys. The company also inked a deal with Walt Disney to become the official supplier of musical instruments for its Disneyland Resort theme park. – less