If China’s Covid-19 lockdowns persist with curbs forcing assemblers to shut down and maintaining closed-loop arrangements gets harder, shipments of some Apple products, as well as Dell and Lenovo laptops, are likely to face delays in supply, analysts warn.
Disruptions caused by jammed highways and ports, stranded workers, and countless factories awaiting government approval to reopen after closing due to China’s race to stop the spread of Covid-19 are rippling through global supply chains.
Pegatron announced this week suspending its plants in Shanghai and Kunshan that produces the Apple’s iPhone 13, the iPhone SE series, and other legacy models, but supply chain experts say that deliveries could be impacted more severely by the shutdown of the operations of Quanta Computer, which produces some three-quarters of Apple’s MacBook globally.
Analysts said the final impact on Apple’s supply chain depends on factors including how long lockdowns persist and is uncertain at the moment since Apple is considering re-routing production to factories in regions that are currently not under lockdown, such as Shenzhen.
Eddie Han, a senior analyst at Isaiah Research, pointed out that they’re expecting limited volume due to the logistics issue and the difficulty of equipment adjustment though Apple may consider transferring the orders from Pegatron to Foxconn – the trade name of Hon Hai Precision Industry.
Han said that in a worst-case scenario seeing the lockdowns last two months and Apple cannot reroute orders, Pegatron may fall behind on 6 million to 10 million iPhone units.
Though Taiwan-based Compal Electronics, the company that makes PCs for Dell Technologies and Lenovo Group from its plants in Kunshan had yet not halted production, the experts estimate that its closure could affect roughly 50% of Compal’s laptop production.
The manufacturer of printed circuit boards for companies including Apple, Unimicron Technology, noted that the Kunshan lockdown’s impact so far has been minor and that it can rely on other plants in the Hubei province and Taiwan to support production.
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