Apple Is Still Facing Supply Chain Issues Despite China’s Recovery From COVID-19
Even though Apple announced new products this week, its supply chain woes are far from over. While China is recovering from its battle with coronavirus, other countries and regions are now facing manufacturing closures due to COVID-19.
A new report by Bloomberg confirms that Apple's newly launched iPad Pro, Mac mini and MacBook Air will be delivered in a timely manner to customers because the production for these products had started in January, before China went into lockdown because of the virus. Now that the phase is over for China, Malaysia has gone into lockdown due to the virus, which means that suppliers have shutdown manufacturing. This means that gaps still exist in Apple's supply chain and could cause delays down the road. As evident by the purchase limits on the new products on Apple's online store, supply constraints will continue for some time.
It is not just suppliers in China and Malaysia that are facing slowdowns in manufacturing. Apple's suppliers in Europe, particularly in Italy, German and the United Kingdom are also going through tough times. iPhone displays are manufactured in South Korea by LG and Samsung, where coronavirus has also caused setbacks. The report adds that Apple's research and development engineers in Israel are on lockdown, while in the United States, production for wireless chips and glass suppliers has been impacted.
Despite the hurdles, Bloomberg's sources believe that iPhone 12, Apple's first smartphone with 5G networking, will launch on schedule this fall because manufacturing will begin in May. It is expected that the situation around the world will improve by then and suppliers would have their manufacturing units working at full speed.
Tim Cook had previously claimed that the production issues in China are temporary and things will be back to normal soon as the country is recovering from COVID-19. This is one of the reasons that Apple's retail stores are open in Greater China, and closed in the rest of the world.
While Apple might have been able to announce and ship previously planned products on time, the real challenge lies ahead. Research and development for future products is proving to be difficult for Apple employees due to the company's secrecy around them. Even as countries around the globe tackle and recover from COVD-19, its effects on economy and global supply chains will last for a while.
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