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Supply Disruptions, Production Cuts, And Price Rise Anticipated Due To Coronavirus

With the coronavirus in China showing no sign of abating, and parts of the country being stranded under quarantine, India’s electronics industry fears supply disruptions, production curtailment, as well as a negative impact on prices, revenue, product launches, and local manufacturing. If the situation prolongs, the industry is bound to take a hit by March.

The Indian electronics industry, which relies heavily on China for components, sub-assemblies, and even full products, is gripped with a sense of foreboding about the impact of coronavirus. According to some companies and industry bodies, alternate countries for these supplies or any other solution seems unlikely to transpire. They are assessing the situation and mulling what can be done. Most companies have supplies stocked for the next 2 to 3 weeks, and hence, the epidemic has not impacted them just yet.

Any delay in the supply of components beyond February 17, 2020, can lead to setbacks in production in April 2020, which can affect revenues next year. If the situation persists, it will be followed by production cuts, postponement of product launches in the next quarters, and revenue losses. From the consumer lens, it will lead to availability concerns and price rise.

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