In more bad news for an already fragile global tech supply chain, more than 30 Taiwanese companies including Pegatron and MacBook assembler Quanta Computer have now halted production in the electronics hubs of eastern China to comply with the Chinese Communist Party’s draconian and quixotic COVID restrictions.
On Wednesday, Quanta said it was suspending a Shanghai plant to comply with government restrictions. At least 30 other companies are suspending output in nearby Kunshan until April 19, they said in filings to Taiwan’s stock exchange. Some said the effect on their finances is still unknown, while others expect no major impact. Kunshan, a bustling city that hosts Apple Inc. suppliers including Pegatron and Luxshare Precision Industry Co., began a city-wide lockdown in early April.
The companies make parts for consumer electronics products ranging from PCs and smartphones, with many of the components critical for their global customers. The global supply of key tech has already been hobbled by China’s zero tolerance toward the virus and its measures to stamp it out in cities such as Shanghai and Kunshan.
MacDailyNews Take: As we wrote just yesterday, the CCP is currently committing atrocities in Shanghai – starving and imprisoning people; mass killing of people’s pets – and Apple’s CEO, who is often rather vociferous on Twitter about all sorts of issues, whether he understands them fully or not at all, has yet to utter a single peep.
Nor, we bet, will Cook ever utter a peep over these actual atrocities.
This comes after years of the CCP committing genocide, crimes against humanity, and torture of Uyghurs and members of other minorities in the Xinjiang region.
Is this CCP crackdown in Shanghai really about COVID or it is actually about something else, such as, oh, perhaps the imposition of control and the message it sends to Chinese citizens?
This current Pegatron issue (minor, but indicative) is what happens when you shortsightedly paint yourself and the company you purport to lead into a corner then fail to realize and correct your mistake in a timely manner.
Widespread Chinese lockdowns have begun to exact an unquantifiable toll on the world’s No. 2 economy, the biggest buyer of semiconductors and the largest producer of electronics from iPhones to PCs.
Disruptions to local manufacturing are set to worsen the logistics hurdles of global companies already grappling with a shortage of cargo capacity that’s pushed shipping costs to record highs and a prolonged chip crunch.
Local officials on Wednesday placed two Kunshan districts with significant electronics manufacturing into lockdown for an indefinite period, while for certain other districts the lockdown was extended by seven days.
MacDailyNews Take: As we wrote just last week:
Clearly, Apple under Tim Cook had, has, and, for the foreseeable future, seems like it will continue to have far too much exposure to China and the CCP’s overbearing and often irrational whims.
Memo to China: There’s no such thing as zero-COVID. Duh.
As we’ve said for years now, for better and worse, Apple is wedded to China. It will take many years to even begin to extricate itself from this relationship, at least the the point where the company has some meaningful leverage that the CCP understands.
This situation has been building for years and, for the foreseeable future, will continue to get worse for Apple, not better.
The real virus is the panic. #coronavirus #CoronavirusOutbreak @elonmusk
#marketcrash #marketcrash2020 https://t.co/tONjs0PgUc pic.twitter.com/42d8JCS4Js— MacDailyNews (@MacDailyNews) March 9, 2020
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