Several factors seem to have contributed. German makers were often slow to respond to market changes, while Japanese companies pushed affordable, reliable cameras that matched what more photographers wanted. Community answers point to three recurring themes: underestimating Japanese competition, focusing too much on protecting premium product lines, and making weak strategic decisions.

A specific example mentioned is Zeiss/Voigtländer: in trying to avoid cheaper models competing with premium Contarex cameras, they reportedly held back development or features on lower-priced lines. That left them exposed as the market moved toward more practical mass-market SLRs.

Price and quality also mattered. Early Japanese products had a poor reputation, but that changed as photographers saw strong real-world results. Nikon’s reputation rose sharply when prominent photojournalists, including David Douglas Duncan and other Life photographers, used its equipment during the Korean War era. That kind of visibility helped shift professional and public perception.

In short, the decline was not just about lower prices; it was also about innovation, reliability, better alignment with market demand, and Japanese brands gaining credibility at exactly the right time.

A reference mentioned in the answers is the German article “Westdeutsche SLR” on klassik-cameras.de.