Coronavirus Expected to Cause Five-Week Product Shipment Delays, Says Electronics Manufacturing Industry


Reading time ( words)

Electronics manufacturers anticipate at least a five-week product shipment delay from suppliers due to the coronavirus epidemic, according to a survey conducted by IPC, a global electronics manufacturing association. The group says shipping delays from China and other countries where the virus has spread are already having negative impacts on manufacturers.

Roughly 65% of manufacturers report their suppliers expect, on average, a three-week delay. However, electronics manufacturers expect delays to be longer than what their suppliers are currently quoting. On average, executives expect shipment delays to be at least five weeks.

“The delays will likely have ripple effects for the rest of the year,” said John Mitchell, IPC’s president and CEO. "The longer China is affected by the epidemic, and the more it spreads to other parts of the world, the supply chain will experience more and varied strains and disruptions.”

An overwhelming majority (84%) of electronics manufacturers and suppliers are worried about the epidemic’s impact on their business operations. Delays in receiving supplier inputs can lead to factory downtime, higher average costs, transportation bottlenecks, pressure for alternative sourcing, delayed sales, and delayed prototyping that slows the introduction of new products.

“In most cases, it’s not easy for manufacturers to switch suppliers, if that’s what turns out to be necessary,” added Mitchell. “Securing alternate sources requires an investment of significant time and money that must be weighed against the value gained.”

IPC surveyed industry professionals at electronics manufacturing companies, including original equipment manufacturers (OEMs), electronics manufacturing services (EMS) companies, and printed circuit board (PCB) fabricators. Almost half of the survey respondents represent the contract electronics manufacturing services (EMS) industry. This segment performs an estimated 25% of North American electronics manufacturing for OEMs. The survey was conducted between February 11–16, 2020.

IPC will continue to perform regular surveys and research on this issue.

About IPC

IPC (www.IPC.org) is a global industry association based in Bannockburn, Ill., dedicated to the competitive excellence and financial success of its 5,800 member-company sites which represent all facets of the electronics industry, including design, printed board manufacturing, electronics assembly and test. As a member-driven organization and leading source for industry standards, training, market research and public policy advocacy, IPC supports programs to meet the needs of an estimated $2 trillion global electronics industry. IPC maintains additional offices Washington, D.C.; Atlanta, Ga.; Brussels, Belgium; Moscow, Russia; Bangalore and New Delhi, India; Bangkok, Thailand; and Qingdao, Shanghai, Shenzhen, Chengdu, Suzhou and Beijing, China.

Share

Print


Suggested Items

Dan Beaulieu: Adapting to New Methods at D.B. Management

03/27/2020 | Nolan Johnson, I-Connect007
In this audio interview, Nolan Johnson gets an update from Dan Beaulieu, a 40+ year veteran of the electronics manufacturing industry and an industry consultant for 25+ years. Dan shares an update on current business operations for D.B. Management, including how—like his clients—he may be at home, but it's still business as usual. Dan also offers his perspective on how our industry will weather and emerge from this challenging time.

Todd Kolmodin: Gardien an Essential Business for U.S. DoD Work

03/30/2020 | Nolan Johnson, PCB007
Todd Kolmodin, VP of quality for Gardien Services USA, updates Nolan Johnson on Gardien’s operations. Specifics include Gardien’s certification as an essential business for U.S. Department of Defense work and an overview of the work and staffing policies in place at all of the company's facilities across the United States and the various work restrictions—all with the goal of “keeping the wheels turning” in the industry.

IPC Chief Economist Dr. Shawn DuBravac Shares Industry's Financial Outlook

03/23/2020 | I-Connect007
On March 23, IPC Chief Economist Shawn DuBravac, Ph.D., CFA, spoke with I-Connect007 publisher Barry Matties in an exclusive phone interview immediately following DuBravac’s online briefing to IPC member attendees.



Copyright © 2020 I-Connect007. All rights reserved.