The story
The company was founded on June 20, 1951, as AIKO Denki Sangyo Co., Ltd., manufacturing microphones, and changed its name to Aiwa Co., Ltd. (アイワ株式会社), on March 10, 1959. Aiwa was listed on the Tokyo Stock Exchange from October 1961 until September 2002. Aiwa created the first Japanese cassette tape recorder in 1964. Aiwa marketed Japan's first boombox, the TPR-101, in 1968, as well as the first cassette deck, TP-1009. The founder Mitsuo Ikejiri served as president until 1969 when Sony purchased a majority share in Aiwa. By 1982, the electronics giant had an increased 54.6% stake in the company.
In 1980, Aiwa created the world's first personal stereo recorder, TP-S30 (marketed as CassetteBoy in Japan). Despite Sony being the major shareholder, healthy competition between the two brands was believed to be profitable. Aiwa faced its first crisis in the mid-1980s after the strong yen (Endaka). To counter this, the company boldly decided to shift manufacturing overseas like Singapore and Malaysia. It also stopped making Betamax VCRs to focus on its profitable portable audio-video products. The resulting lower costs for the products made the company target developing markets, later expanding exports to developed markets as well. The number of Aiwa factories in Japan were reduced from three to one. Hajime Ugi led this change and resulted in making Aiwa profitable again in FY 1989.
Aiwa home audio products incorporating BBE signal-processing technology were launched in about 1989, after the company signed a licensing deal with BBE Sound. Also around this time, some Aiwa products were briefly being sold in Japan under the Excelia and Strasser sub-brands.
It had also released the first cassette deck with Dolby C in its home country. In 1993, the first CD+G-compatible portable CD player, the XP-80G, was made.
Diversification
Apart from audio products, Aiwa was also present in other industries. The company also made and sold video products such as VCRs (it backed the Betamax standard of its parent Sony) and also color televisions and in later years DVD players, and digital satellite television tuners. Aiwa was also involved in the production of computer peripheral devices, such as modems, terminal adapters, and speakers, and what the company termed "life amenity products", such as air cleaners and humidifiers. In 1995, it released a PHS mobile phone, called the PT-H50, which was made for the DDI Pocket network in Japan. That same year, an electric toothbrush was released.
As of 2000, up to 70 percent of Aiwa's sales came from home audio products.
Later years
When the yen reached record highs in the early 1990s, Aiwa boomed thanks to its production facilities outside of Japan. With a new expansion in mini component systems like bookshelf stereos, Aiwa made a return to the Japanese market and captured 20% market share in that field in 1992, rising to 27% in 1994, thanks to affordability during the post-bubble recession. The company's performance was also beneficial to Sony who's own market share in mini component systems had reduced in this period.
For its 40th anniversary in 1991, the company changed its logo.
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In 1991, Aiwa launched its highly successful NSX line of mini-component stereo systems, combining amplifier, radio tuner, dual cassette decks, CD player and two speakers in one box. As of the mid-1990s, Aiwa held a 30% global market share in the field of these stereos and as much as 50% in the United States.
Aiwa entered the MiniDisc player market in 1995, however the players were mostly rebadged Sony players.
Cuts and acquisition
In the late 1990s, Aiwa faced growing competition from price-cut Asian manufacturers, shrinking demand at home following a dismal Japanese economy in 1998, and disruption to its supply model following the Asian financial crises. Aiwa's profit margins quickly shrunk when it attempted to cut its own costs in response, and the company failed to invest in digital technology. Aiwa made two consecutive years of large losses and slid towards bankruptcy.Parent company Sony dispatched Masayoshi Morimoto to become Aiwa's new president. In March 2001, Morimoto announced a major restructuring, including the halving of its workforce, following a second consecutive loss–making year. It also announced the closure of all but one of its manufacturing plants, including all in its home country. Sony also injected Aiwa with capital by increasing its stake in the subsidiary to 61 percent.
In February 2002, Sony announced that it will acquire the remaining share it does not own in Aiwa by way of stock exchange. Sony president Kunitake Andō told reporters that "In the past we have grown through competing with each other. This no longer works". In fiscal year ending 2002, a net loss of 53 billion yen was reported for Aiwa, up from a loss of 30 billion in 2001 and itself up from a loss of 9.9 billion in 2000. It was made worse by retirement benefit payouts related to its workforce cuts as part of its failed turnaround efforts. Its workforce had been cut by 90% between 2001 and 2002. The acquisition was completed effective as of December 1, 2002.
Brand relaunch
On January 8, 2003, Sony announced the rebranding and relaunch of the now-defunct Aiwa as a "youth focused, PC-centric" electronics brand. A new logo was presented to the world's media along with a statement of Sony's intention to invest in and "revitalize" the Aiwa brand. The direction proposed was to capitalize on the growing trend among personal-computer-literate teenagers and young adults to use their PCs for all forms of entertainment (television, films, music, chat). It was also used to expand in markets where Sony is not as strong.
Aiwa introduced its first digital audio players at CES 2004, including both flash players and a 2GB hard disk player. They notably supported MP3 format while Sony's own branded players only played ATRAC. Aiwa's portable CD players were equipped with a so-called E.A.S.S. G.P. (Electronic Anti-Shock System) feature with the aim of allowing smooth, skip-free Audio CD playback despite damaged media and external shaking.
However the new direction of Aiwa under Sony did not meet consumer and sales expectations. On January 21, 2005, new product development ended, and by 2007, Aiwa products were discontinued and no longer sold in the market outside its home market. Sony announced the termination of the brand entirely on May 14, 2008 but continued to provide support for existing products.
From Wikipedia’s article on Aiwa, shared under CC BY-SA 4.0.4