Coronavirus- Making Computers more Expensive?
We've all heard the news: Coronavirus is causing a world wide panic, even as close to home as Harding (Sorry HUF friends). This virus is doing more than causing mass hysteria, it’s impacting productions, supply chains and markets across the globe. Here are some ways it can and possibly will impact the world of electronics:
Samsung
Two of Samsung’s largest production centers are based in China and in South Korea.
Both areas have production nearly or completely halted due to the virus. Samsung is one of the
world’s largest producers of both computer chips (typically smartphone), DRAM (the thing
opening more than one Chrome tab destroys), and NAND flash memory (how Solid State Drives
work).
Two of Samsung’s largest production centers are based in China and in South Korea.
Both areas have production nearly or completely halted due to the virus. Samsung is one of the
world’s largest producers of both computer chips (typically smartphone), DRAM (the thing
opening more than one Chrome tab destroys), and NAND flash memory (how Solid State Drives
work).
Samsung’s factory in China is reportedly running as low as only 30% of max production,
possibly just because employees are too scared to go to work. While many companies keep a
small amount of additional parts on hand the shutdown or slowdown of one particular plant
shouldn’t have much impact. Problems arise when production is reduced long enough any
excess inventory is used up. This would cause a massive upset in most supply chains, especially
computers and smartphones. This lower supply would undoubtedly drive up prices for RAM,
SSDsand Smartphones for both companies and the Consumer.
Apple
Apple announced this week the impact that Coronavirus has had on their productions. Apple cut its sales expectations dramatically due to the virus which forced many of their factories to close entirely. Most of this drop in sales is caused by how slowly factories are taking to reopen production; it will take substantially longer than experts predicted to once again be running at full capacity. In mid-February, it’s estimated nearly 750 million people were under some form of lockdown in China and China has only recently begun opening up factories and allowing people to return to work.
No comments: