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August 16, 1988

US-JAPAN COMPETITIVE DISADVANTAGE ECXACERBATED BY HARRIS BUY

By CBR Staff Writer

The decision of General Electric Co to sell its semiconductor business to Harris Corp exacerbates still further the near-fatal disadvantage that the US sufferes in competition with Japan: GE has a similar industrial profile to those of the Japanese electronic giants, and is probably more like Toshiba Corp, with which it has close links, than any of the others – but where Toshiba, as a major user of chips, is convinced that it needs to make them for its own use and sell the surplus on the open market – and is substantially expanding its chip business, GE, also a major user, is abandoning the business, and with the best will in the world, a Harris Corp, even inflated to annual sales of $2,600m, cannot hope to compete on equal terms with six or seven Japanese electronics companies each around 10 times its size.

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