Shipments of laptops, mobile phones and other technology products are likely to be delayed if lockdowns continue in China due to the outbreak of the Covid-19 pandemic.
This is supported by several analysts as they see the restrictions forcing fitters (located in China) to close production lines. China’s policy of limiting the spread of Covid-19 has led to roadblocks and port closures, trapped workers and left countless factories awaiting government approval to reopen.
Pegatron, a supplier to Apple, has announced that it will suspend operations in its Shanghai and Kunshan plants, which are believed to produce the iPhone 13, iPhone SE and older models of the company.
Quanta Computer, which makes up about three-quarters of Apple Macbooks worldwide, has also shut down its plants, which could have a more serious impact on the results, according to analysts.
According to Reuters, the final impact on Apple’s supply chain is uncertain and depends on a number of factors, including how long the lockdowns last. One solution for the American giant would be to channel production to other factories, in areas where no lockdown has been imposed.
The worst case scenario for Apple is that Pegatron wants to lag behind in production by 6 to 10 million iPhones, if they last two months and Apple fails to transfer its production to other factories.
It is noted that Shanghai is approaching the third week of lockdown and has not shown signs of widespread reopening. Forrest Chen, director of research at Trendforce, told Reuters that if the restrictions were lifted in a few weeks, there was still a chance of recovery. However, “if the lockdown lasts more than two months, there is no way to recover. “At that point, after the lockdown was lifted, there would be a shortage of end users,” he said.
The situation in China is also affected by laptop manufacturers, such as Dell and Lenovo, which, although cooperating with manufacturers in Taiwan, also maintain their production lines in mainland China.