Global CE Supply Chain Slows Due to Coronavirus Outbreak

While the overall consumer electronics market is projected to grow over the next several years, manufacturers are bracing for potential supply chain delays related to the coronavirus.

Global CE Supply Chain Slows Due to Coronavirus Outbreak

The consumer electronics industry has been slowly feeling the effects of the ongoing outbreak of coronavirus this year, with the latest news citing potential disruptions to the supply chain.

In the past month, companies like LG have made their stance clear on the coronavirus by backing out of key industry events like ISE 2020. The event even saw a decrease in overall attendees due in part to travel complications related to the virus.

“With the safety of the public in mind, LG has decided to withdraw from exhibiting at ISE 2020. This decision reduces the risk of exposing employees and customers to international travel which has already become much more restrictive as the virus continues to spread across more borders,” said the company in a public statement earlier in February.

Reed Exhibitions, the company that operates ISC West, has been forced to close its “China Pavilion” at this year’s show due to travel restrictions currently put in place by the U.S government.

But the news is not all doom and gloom, as group vice president of Reed Exhibitions Will Wise does not expect the travel restrictions to adversely impact the overall attendance of ISC West.

There are also significant reasons to be optimistic about the short and long term future of the industry. According to new research, the overall health of the U.S portion of the CE industry is projected to boom by 2022 and continue through 2050.

In fact, according to research companies like Futuresource and The NPD Group, the demand for consumer audio products is increasing, with the overall technology market poised to experience prosperity for the next several years.

Still, some manufacturers are bracing for potential disruptions to the supply chain from their overseas factories. One leading custom electronics manufacturer, which wished to not be named, recently had its factory closed for two weeks for the protection of its local workforce. Others, like Nortek Security & Control, are being fully transparent regarding the fluid situation, sending out emails notifying customers of upcoming supply chain delays.

Companies like Nortek Security Controls (NSC) have already sent out emails educating customers on the current state of its supply chain.

Here is Nortek Security & Control’s full statement sent out to customers:

To Our Valued Customers,

In response to the global impact of the coronavirus, Nortek Security & Control extends its thoughts for all those affected by the recent viral outbreak in China and beyond.

As a ripple effect, many companies are experiencing supply chain delays and disruptions due to the coronavirus outbreak. It’s expected that the impact on shipping timelines around the world could range from days to weeks.

We, too, are experiencing some delays in manufacturing and shipping from the affected regions and are writing to assure you that we’re closely monitoring the situation and its impact on our manufacturing partners.

This is a terrible and unexpected event that many companies, including ours, are addressing. We’re working hard to minimize the disruption to our customers and would like to share with you our initial steps in response to the situation:  

  • We are diligently working with each of our suppliers to prioritize the production scheduling, the return of personnel, and ensuring that our customers are supported to the best of our ability.
  • We are actively managing any impacted products lines, offering substitutions where available and utilizing buffer/safety stock when we can.
  • We are working with long lead time suppliers to minimize impact of raw material used to build our products.
  • We are closely planning with key suppliers and partners as this will likely affect logistics, including container availability, driver availability, and port congestion.

We apologize for any delays this may cause you. Rest assured that we have a watchful eye on manufacturing developments and its potential impact to your business. We believe open communication is key and we will keep you informed with regular updates.   

We appreciate your commitment and patience. If you have questions or need help planning, please don’t hesitate to reach out to your Sales Manager.

Steve Deblock
Executive Vice President of Operations
Nortek Security & Control

About the Author

Andrew Nichols
Andrew Nichols:

Andrew is a journalist and educator living in the Providence area. He was previously the Editor-in-Chief of a gaming and tech website, and the Managing Editor of his university newspaper, The Torch. He received his Bachelors in Writing and Masters in Teaching from the University of Massachusetts Dartmouth.