TV, computers, and circuit boards are all products of electronic equipment manufactured in the electronic industry. Since the early 2000s, the electronics industry has grown rapidly. Businesses and young adults are in high demand for automation of new products. Since the beginning of the COVID-19 pandemic, electronic manufacturers have faced difficulties with suppliers and production.
China is one of the key suppliers of raw materials for electronic manufacturing. However, India is quickly becoming the global leader in electronic equipment. Due to COVID-19, there is an impact on the electronics industry, in India specifically. This is because logistic providers are not able to transport their goods across borders, due to governmental restrictions resulting from the pandemic. In China, plants across the country have been temporarily shutting down because of the pandemic. This is seriously affecting China and India because the supply chain components imported into India have been impacted due to closures. Therefore, there are part shortages in India’s supply network.
In India, there are plenty of companies involved in electronic manufacturing. This ranges from IT hardware, medical electronics, automotive electronics, etc. Since they are not able to transport their goods across borders, the electronic manufacturers are not able to create different types of products. This is not only affecting the electronic industry, but many other industries that use electronics.
Considering many industries are being affected by the pandemic and rely on electronic manufacturing, there are delays in shipment times for most products. A survey conducted by the IPC (Global Electronics Manufacturing Association), concluded that 69% of respondents received a warning from their suppliers about shipment delays since the beginning of the pandemic. There is a limited number of cargo vessels and a four-to-five-week delay for shipment of products. Electronic manufacturers believe that the delays will be longer than what suppliers are anticipating. These delays result in different transportation bottlenecks, higher marginal cost of logistics, delayed sales, factory downtime, etc.
Since the pandemic is still a global threat, there is an unlikely chance that transportation and logistics will improve in the near future. This will result in the price of raw materials to increase and there will be a shortage of parts. Even if looking for a new supplier was in sight, it is difficult for electronic manufacturers to find new suppliers to work with. Due to problems because of the pandemic, India and China are experiencing supplier issues, which limits the number of suppliers and makes it difficult to find a new supplier. Looking into new suppliers requires a great deal of time and money, which these manufacturers do not have because of COVID-19.
Tariffs that China and the US imposed on each other forced American companies to find another way to continue production and source parts. Even if companies found solutions onshore, there were production and shipment delays during the peak of the pandemic. Since most companies required workers to work from home, there was an increase in cellphones, computers and other electronic equipment. This caused the semiconductor industry to change production and the electronic manufacturers could not keep up with the extra demand. Due to the semiconductor crisis, automotive makers postponed the creation of new autonomous vehicles.
Even though the pandemic has disrupted supply chains across the world, companies can look to make future improvements with automation in manufacturing plants. Future developments can create more opportunities for remote jobs, while also making manufacturing plants a smart workplace. Having remote workplaces for manufacturing plants could bring ideas into creating remote transportation management systems. There would be opportunity for logistics to become completely remote and robotic. Workers can still control the shipments, though, they will be controlling a robot rather than physically controlling the mode of transportation.
Looking more into the electronic manufacturing industry and COVID-19, I learned how location, the domino effect, and the future are impacted due to COVID-19. Since India is becoming the global leader for electronic equipment and China is a key supplier for electronic manufacturing, the industry was hit hard when these countries were affected by the pandemic. The pandemic had a major impact on electronic manufacturers, which impacted many other industries as well. Even though leaders in the electronic manufacturing industry were harmed by COVID-19, the pandemic has brought light to new ideas on how to run operations. These new ideas will involve the electronic industry and possibly take over how businesses run in the future.
Authored by: Courtney Gozdor
References:
Click to access managing-the-impact-of-covid-19-on-india-supply-chains.pdf
https://www.sourcetoday.com/supply-chain/article/21132924/how-covid19-has-impacted-the-electronicssupply-chain https://svtronics.com/blog/what-you-should-know-about-the-current-shortage-of-electronic-components/
