It is not just us; the coronavirus is infecting the global electronics like LCD monitors, smartphones, etc. as well! With more people getting infected every day, the electronics industry is falling short of working hands and materials.
Coronavirus and LCD Production— What’s the relation?
You may be wondering about how LCD production is related to the coronavirus. Well, people in China, especially in Wuhan, are leaving no stone unturned to prevent the virus from spreading. Thus, five LCD factories have been shut down, and others are facing issues such as personnel shortage. Even schools, shops, restaurants, and movie theaters within Wuhan have shut down.
The disparity in Supply and Demand
Wuhan is not just the epicenter of the coronavirus epidemic but also China’s industry and transportation. According to Informa Tech and IHS Markit service, the capacity utilization for all LCD fabs is expected to fall by at least 10-20 percent during February 2020. This will lead to an imbalance of supply and demand, resulting in a price hike of $1-5. Subsequently, manufacturers would cash on extra profits at each stage of production. Thus, sale prices could end up skyrocketing.
The government extended the Chinese New Year holiday until February 2 to relieve the situation temporarily. But companies are still struggling with carrying on production. With China being one of the biggest producers of automobiles, electronics, etc., there could be a worldwide slump in sales.
David Hsieh, senior director of displays, said, “Display facilities in Wuhan currently are dealing with the very real impacts of the coronavirus outbreak”. The shortage of labor and key components has resulted in an unavoidable decline in production. Moreover, IHS reported that production at several key third-party LCD module suppliers has come to a halt, even if the suppliers are there.
These drastic changes are having a direct impact on LCD panel pricing, laptop manufacturing, smartphone production, etc. While AMD and Intel ignored the effects of coronavirus among their forecasts, Microsoft came with a broader than usual forecast, focusing on the ups and downs that would result from the outbreak.
With more than 7000 people trapped in the jaws of coronavirus and nearly 200 deaths, the World Health Organization has declared a global emergency, and the U.S. State Department has banned travel to the country. Even the residents of Wuhan who left the city for Lunar New Year are unable to return until the ban is lifted.
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