23 Mar 2020
Posted in Coronavirus
COVID-19 leaves consumer electronics at the mercy of supply chains and dampened demand
The coronavirus (COVID-19) is by far the most significant theme to affect the technology industry in 2020. It will put incredible strain on the world economy, which will be effectively halted for three months or more. Many companies will not survive this initial phase. Almost all others will suffer significant drop in revenues, says GlobalData, a leading data and analytics company.
GlobalData published a fully revised report, ‘Tech, Media & Telecom Trends 2020’, to reflect the impact of COVID-19 on 17 separate TMT sectors. Its analysis provides insight into the impact of COVID-19 on leading companies, as well as the impact of COVID-19 across 17 different technology sectors. It discusses the short- and long-term impacts of COVID-19 on each sector, and ranks on a company-by-company basis the individual impact of COVID-19 alongside nine other themes that affect that sector. All sectors will be negatively impacted.
David Bicknell, Principal Analyst in the Thematic Research Team at GlobalData, says: “Consumer electronics firms’ supply chains rely on Chinese components. As China, the source of the COVID-19 outbreak, slowed down and then stopped, supply chains were disrupted. Apple, with more than 90% of its products made in China – and 18% of its revenues generated there – is one of those that suffered, with its ranking in GlobalData’s consumer electronics thematic scorecard tumbling from No. 4 to No. 14.
“The economic contagion caused by COVID-19 will affect general consumer confidence and dampen demand for electronics until the health outlook looks brighter. However, there are some bright spots in the gloom. Drones are now being used on the front line in China, Spain and the US to deliver medical supplies and to chastise loitering citizens to get indoors and self-isolate. Moreover, 3D printing is coming to the rescue for hospitals urgently needing spare parts for respirators. Eventually, when life has returned to normal and consumers have the confidence to spend, there will be increased spending on devices.”