Smartphone and consumer electronics companies in India announced that it would experience delays in the launch of new products and incur production cuts due to decreasing component supplies.
The China factory shutdowns were pointed as the main culprit of the declining Indian market and that the scale of impact would depend upon how long the outbreak would last.
It was announced that about 75 percent of the total value of components used in televisions and about 85 percent of smartphones are produced in China.
A recent report claimed that these critical components involved in the creation of mobile displays, open cell TV panels, circuit boards, memory chips, and LED chips in India were also imported from China.
Thus, consumer electronics and smartphone companies operating in India declared that the recent factory shutdowns in China would cause a significant decrease in the supply of parts needed to create smartphones and electronics products causing a delay in the launch of new products.
Furthermore, the report claimed that Chinese vendors have imposed component price hikes by two to three percent due to supply shortages caused by the said factory shutdowns. It was also revealed that the price hikes might continue until the outbreak is contained in the country.
India's production of paracetamol and antibiotics products were also hit by the epidemic.
Media reports further claimed that the disrupted industrial activity in China has been at a standstill and that it would mean bad news for Indian industrial players.
According to a senior executive at a leading smartphone brand, factories in India had been preparing for the Lunar New Year supply shutdown.
However, the said executive claimed that electronics companies have not been prepared for an 'extended' holiday caused by the Wuhan coronavirus epidemic.
The said correspondent added that companies have withheld work for the next few days and that it would likely have a significant impact on manufacturing products in India.
The CEO of Super Plastronics Avneet Singh Marwah added that although the Lunar New Year was expected by January 31, 2020, Chinese authorities have extended the vacation to last until February 9, 2020.
It was also hinted that there is a possibility that the deadline would be extended prolonging further the shortage of supply of industrial products.
Marwah claimed that production in India would be badly hit with the 15 to 20 days of delay in supply components. He added that purchase offices in China had been closed down and that product launches of Kodak and Thomson brand televisions in India would be delayed.
He also claimed that if the shutdowns would continue, there would be chaos in the industry since this would result in companies' unwillingness to hold stocks in large quantities due to the uncertainty of price levels and restrained domestic demand.
