The surge in COVID-19 cases in the Shanghai region and the restrictions put in place by the government are having an immediate impact on production lines.
The COVID-19 epidemic is far from behind us. In China, contamination due to the Omicron variant has been exploding for several days.
Omicron wins the Shanghai region, the government imposes containment
In response to this epidemic rebound, the Chinese government ordered a general containment of the city of Shanghai and its surroundings. Measures to control the movement of employees and workers as well as a massive use of teleworking, when permitted, have also been put in place.
According to the publication Commercial Times of Taiwan, all these public health measures could have serious repercussions and “ could seriously harm the global electronics industry “.
Indeed, it is in the city of Kunshan, located on the outskirts of Shanghai, that the production sites of subcontractors Compal, Pegatron and Wistron are located. The latter manufacture a good part of the laptops sold in the world. There is also AUO, a manufacturer of monitors, or Nanya, a company specializing in the manufacture of semiconductors, and in particular DRAM.
In detail, Compal places its production lines at the service of groups such as Apple, Acer, Lenovo, Dell, Toshiba, HP and Fujitsu. Pegatron also works with Apple, but also with Microsoft for its Surface range. Wistron, meanwhile, produces laptops for Lenovo, Xiaomi, Acer and HP.
A sharp slowdown in production which raises fears of new shortages
Other manufacturers have already suffered or are suffering disruptions on their production lines, such as TSMC, Quanta or Foxconn.
These containment and quarantine measures are currently in effect until April 6, but industrialists, scalded by two years of pandemic, fear that they will be extended as part of China’s “zero COVID” strategy.
If the situation were to last, laptop stocks could quickly empty, and the consequences of this slowdown in production could be felt throughout 2022.
We are not there yet, but it is almost certain that the health situation in Shanghai will probably be watched by the tech giants like milk on fire in the coming days.
On the same subject :
Shenzhen, the confined Chinese “Silicon Valley”: delays and (new) shortages to be expected
Source: Tom’s Hardware
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