Impact of COVID-19 on Electronics Industry

The outbreak of the COVID-19 has made the electronics industry under pressure owing to the logistics slowdown, city shutdowns, and unavailability of the workforce across the globe. China is the main center of the electronics industry’s supply chain, with the presence of organizations including Foxconn basing that has massive factories in the country. China-based manufacturers are increasingly panic related to the disruptions linked to the COVID-19 that include delay production for weeks of end-product consumer electronics. Shipping delays from China can cause several negative impacts for manufacturers based in North America, Europe, and other regions that rely heavily on inputs from China in order to produce finished electronics goods in their domestic factories. Further, delays in raw material delivery are leading towards the increasing downtime of the factory that results in higher average costs and lower financial performance. 

Browse the full report description Impact on Global Electronics Industry Size, Share & Trends Analysis Report by Product Type (DRAM, SSD, MCP, Processor, Image Sensor, and Others), By Application (Automotive, Communication Equipment, Enterprise System, Industrial, Personal Electronics) Impact of COVID-19 on Global Electronics Industry, and Forecast 2019-2025 at https://www.omrglobal.com/industry-reports/impact-of-covid-19-on-global-electronics-industry

Major electronics companies have already indicated some degree of impacts from COVID-19 globally. Apple Inc. has already announced that it would not meet previously announced sales projections for the first quarter. The company also delayed the launch of the iPhone 9 due to this pandemic outbreak. Both Hyundai and Nissan have announced production suspension in the South Korean plant due to the delay of the electronics parts. Research by the American Chamber of Commerce in Shanghai (AmCham Shanghai) found that two-thirds of US businesses operating in China expect demand to be lower as a result of COVID-19 due to lack of sufficient staff.

However, the impact of the COVID-19 on the import & export of electronics due to the logistics slowdown in the first quarter is avoidable. Generally, the first quarter is the slowest period every year for the electronics business all across the globe. Although the results for the second quarter depend heavily on the recovery from the spread from the pandemic. The impact of COVID-19 on the chipmaker is more serious in the package and testing realm. Many packages and testing plants in China have reduced or even stopped their operations owing to the lack of workforce. This has created a cutthroat for chip manufacturing companies that rely on such back-end package and testing capacity.