Since the date 23th January until now more than 80k people infected and 2k lives claimed due to life-threatening disease “Coronvirus’ officially named as COVID-19. The coronavirus outbreak has effected massively on the people and their health not only in Wuhan, however spread through other cities of China and also in other countries in the world.
An immediate arise of coronavirus not only disturbed rail cargo services, trucking, cargo shipments, however, but it also affects supply chain operations immensely such as on supply of pharmaceutical and medical products, mobile accessories, automotive, optoelectronics, semiconductors, etc. The prominent companies like Guangdong, Zhejiang, Shanghai, and Beijing have ordered to halt further operations and supply until the inconvenience of coronavirus gets terminated.
Even though the outburst is being compared with SARS outburst that happened in 2003. China has become a more developed country and also integrated with other global markets and also it has significant improvement in its transportation networks. Only a few industries caught by the impact of coronavirus.
The SARS epidemic started in the Guangdong province in 2002 and led to 8,000 cases in 2003. During that year, the GDP of China represented 4.31% of the world GDP. By contrast, the number of detected cases of Covid-19 has already passed 80,000 and China represents about 16% of the world GDP, an almost four-fold increase.
Given the current efforts by the Chinese government to quarantine almost one half of its population and the negative impact that’s having on transportation and manufacturing activities in the country, we can safely conclude that the impact of Covid-19 on Chinese manufacturing is at least an order of magnitude larger than that of SARS.
Scarcity of labour and material, travel barriers, and logistical challenges due to border closures or harden controls have to augment the impact of coronavirus on the supply chain industries as it did the past 17 years.
The impact of coronavirus on supply chain
Although it is not easier to measure the exact impact of the coronavirus outbreak. Its effect is being hiked up massively on the supply chain industries such as:
“ In the automobile market, which relies heavily on air cargo for just-in-time supply chains, TrendForce noted the quarantines and extended factory closures caused material and component shortages for overseas manufacturers, indicating a 14% decline in the global auto market in the first quarter “
“Also Digital Freight forwarding companies Predicts Clients to expect delays in getting goods out of China, and consider shifting some shipments from sea to air or even sourcing goods from other countries where possible. The backlog of shipments that typically follows the Lunar New Year will be made worse by the current situation, pushing ocean freight rates up and exacerbating delays “