A new set of COVID restrictions in China could interrupt international supply chains, experts warn.
New headlines today show unprecedented lockdown activity in Chinese regions like Shenzhen and Changchun are based on case rates that analysts say are higher than many of those reported in 2021, yet, when you look at the numbers, they look lower than what a lot of other loosening nations are experiencing.
“The National Health Commission on Monday reported 2,125 new locally transmitted coronavirus cases across the country,” writes Lily Kuo at the Washington Post. “Since last week, cities have ground to a halt to stop the outbreak, which comes as the country enters a critical year for transitions in the Chinese leadership, with President Xi Jinping set to take a controversial third term.”
The effects are evident at places like Unimicron Tech Corporation, which supplies American firms like Apple and Intel, and Sunflex, a printed circuit board supplier.
That may filter down to the supply chains of automakers Toyota and VW, as well as some big tech firms, and some re calling for a looser response.
“Hopefully they will let us carry on with the production soon,” said an unnamed manufacturer, as quoted by Sarah Wu and Yimou Lee at Reuters. “There’s not much we can do. The whole world has moved on, except for China. They should just let go of the zero-COVID strategy.”
And then there’s Russia.
“Toyota will halt production at its Russian factory, while vehicle imports into the country have also stopped indefinitely due to supply chain disruptions,” writes Sam Street at Paint and Panel. “Toyota is Russia’s top-selling Japanese brand.”
As for Volkswagen officials, they have suggested that a microchip shortage is going to be resolved by next year, as reported last week. Keep an eye on these big firms as their international supplies are constrained.
