Apple iPhone, MacBook shipments may delay as China continues to be under COVID lockdown

COVID-19 cases are rising in China again and that is likely to have an impact on the consumer electronics market. As per Reuters, analysts predict shipments of some Apple products will face delays if the lockdown continues for a few more weeks. Apple's supplier Pegatron has already suspended its plants in Shanghai and Kunshan, as per guidelines issued by the Chinese government.

Pegatron reportedly manufactures the iPhone 13, the iPhone SE, and some other products, and the shutdown of production lines for a long time will impact shipments of these products. Additionally, Quanta Computer Inc, which produces three-quarters of MacBooks globally, has also shut operations, which analysts believe will "impact delivery more severely". The final impact on the supply chain depends on how long the lockdowns persist.

Taipei-based Eddie Han, a senior analyst at Isaiah Research predicts that Apple may consider "re-routing production out of Shanghai and Kunshan" to factories in Shenzhen or other places, which are not under lockdown currently. "Apple may consider transferring the orders from Pegatron to Foxconn, but we expect the volume may be limited due to the logistics issue and the difficulty of equipment adjustment," he said.

Han also added that "as a worst-case scenario, Pegatron may fall behind on 6 million to 10 million iPhone units if the lockdowns last two months and Apple cannot reroute orders".

Shanghai is approaching its third week of lockdown and there are no signs of lifting the restrictions any time soon. Forrest Chen, research manager at Trendforce told Reuters, "if the lockdown lasts longer than two months, there is already no way to recover. At that point, after lockdown lifts, there would be a shortage for end-users". If the lockdown extends, some suppliers are expected to re-route production to other factories.

The report also reveals that laptop makers are also likely to suffer shipment delays, including Compal Electronics Inc, which makes PCs for Dell and Lenovo from its plants in Kunshan. Compal hasn't halted production in Kunshan yet.

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