Advertisement
News
EEtimes
News the global electronics community can trust
eetimes.com
power electronics news
The trusted news source for power-conscious design engineers
powerelectronicsnews.com
EPSNews
News for Electronics Purchasing and the Supply Chain
epsnews.com
elektroda
The can't-miss forum engineers and hobbyists
elektroda.pl
eetimes eu
News, technologies, and trends in the electronics industry
eetimes.eu
Products
Electronics Products
Product news that empowers design decisions
electronicproducts.com
Datasheets.com
Design engineer' search engine for electronic components
datasheets.com
eem
The electronic components resource for engineers and purchasers
eem.com
Design
embedded.com
The design site for hardware software, and firmware engineers
embedded.com
Elector Schematics
Where makers and hobbyists share projects
electroschematics.com
edn Network
The design site for electronics engineers and engineering managers
edn.com
electronic tutorials
The learning center for future and novice engineers
electronics-tutorials.ws
TechOnline
The educational resource for the global engineering community
techonline.com
Tools
eeweb.com
Where electronics engineers discover the latest toolsThe design site for hardware software, and firmware engineers
eeweb.com
Part Sim
Circuit simulation made easy
partsim.com
schematics.com
Brings you all the tools to tackle projects big and small - combining real-world components with online collaboration
schematics.com
PCB Web
Hardware design made easy
pcbweb.com
schematics.io
A free online environment where users can create, edit, and share electrical schematics, or convert between popular file formats like Eagle, Altium, and OrCAD.
schematics.io
Product Advisor
Find the IoT board you’ve been searching for using this interactive solution space to help you visualize the product selection process and showcase important trade-off decisions.
transim.com/iot
Transim Engage
Transform your product pages with embeddable schematic, simulation, and 3D content modules while providing interactive user experiences for your customers.
transim.com/Products/Engage
About
AspenCore
A worldwide innovation hub servicing component manufacturers and distributors with unique marketing solutions
aspencore.com
Silicon Expert
SiliconExpert provides engineers with the data and insight they need to remove risk from the supply chain.
siliconexpert.com
Transim
Transim powers many of the tools engineers use every day on manufacturers' websites and can develop solutions for any company.
transim.com

Coronavirus Exposes West’s Vulnerability

By   02.06.2020 0

How the coronavirus crisis will play out is unclear, due largely to the opacity — or as some observers describe it, “managed transparency” — of  China’s central and provincial governments. Perhaps, as some observers caution, the virus plaguing manufacturing centers like Wuhan affects the global supply chain in the same way an earthquake in Taiwan shuts down chip fabs.

Eventually, we hope, production comes back.

That’s looking less likely with each passing week. Among the first concrete signs of virus-induced strains in the technology pipeline emerged on Feb. 4 when automaker Hyundai ran out of key components, shutting down production lines in South Korea.

What worries China watchers is a full-blown pandemic that would have long-term consequences, exposing the vulnerability of a global distribution network reliant on a single national source of everything from toys and surgical gowns to auto components and flat screens. That worst-case scenario in which factories are indefinitely shut down and even the movement of goods becomes too risky means western economies would lack entire sets of finished products.

Partner Content
View All
By Shingo Kojima, Sr Principal Engineer of Embedded Processing, Renesas Electronics  03.26.2024

“We are very far away from it yet, [but] if the risk of that happening goes up I would want to have a hedge” to shift production, “which we don’t have at the moment,” said Dan Breznitz, a long-time observer of China’s technological transformation.


A new virus has broken out in China that shares characteristics with a similar virus that caused a deadly epidemic 17 years ago. Even before the new virus has been fully understood, it has caused considerable disruption, and has the potential to cause much more. This special project investigates what we know so far about the virus and its possible consequences on the global high-tech supply chain.


Indeed, shifting production out of China would take years, not months, since key competencies like production engineers and alternative suppliers have largely disappeared in the U.S., added Breznitz, Munk Chair of Innovation Studies at the University of Toronto and co-author of an influential book on China’s transformation, Run of the Red Queen.

Dan Breznitz

Recent U.S-China trade tensions prompted a shift of some electronics manufacturing to Vietnam. Vietnam starts out with a lack of scale that limits its potential as an alternate source, however, and a pandemic would eliminate it  (along with most of China’s other neighbors as well) entirely from consideration as an immediate option.

Hence, the key questions are whether the Wuhan virus or other factors eventually change western perceptions of China as the world’s manufacturer, and whether western investors will take steps to mitigate future risks.

“The question is at what point those kinds of risks are deemed so high that not just the companies and their managers but their very active investors — hedge funds — understand that you have to invest billions of dollars over multiple years in order to recreate those sets of skills and capabilities somewhere else,” said Breznitz, who also directs the University of Toronto’s Innovation Policy Lab.

Only a confluence of trade frictions and unforeseeable events like a global pandemic would be sufficient to reconstitute the global supply chain, he added. It’s a Catch-22 situation for technology managers: The threat of a pandemic highlights the risks of doing nothing, but individual companies or investors are for now unwilling to seize the first-mover advantage, fearing a miscalculation would be a career-killer.

The supply chain disruptions caused by the coronavirus have only served to advance the thesis put forth by Breznitz and others that the U.S. industrial base is in rapid decline and will be extremely difficult to rebuild.

“I’m surprised at how quickly American industry lost critical capabilities in order to produce stuff,” Breznitz warned. “How many years will it take American companies to actually figure out how to produce basic stuff?”

His formula for reviving manufacturing in the west is straightforward: “You need to provide carrots, not just sticks.” Put another way, pressing China on trade isn’t enough; the U.S., European Union and Japan must invest for the long term in order to attract the private equity needed to reconstitute their manufacturing infrastructure.

“This is an opportunity,” said Breznitz, “because the private business leaders will listen to you if you talk now,” at the height of a crisis. “They might not listen to you if you talk about it two years from now.”

Below you can find all the stories created for this Special Project: Outbreak in Wuhan

The Outbreak in Wuhan ● Semiconductors and Sulfuric Acid

The Weekly Briefing podcast, February 7

A new coronavirus emerged in China less than three weeks ago, and already it is disrupting business and affecting the global supply chain; we assess the damage so far, and get a live report from China.

 

Wuhan Profile: Besieged City Fights its Next Battle

By George Leopold and Junko Yoshida

The beleaguered Chinese manufacturing hub faces a virus-borne existential crisis.

 

 

Lockdown: Who’s Who in Wuhan

By Clover Lee

The lockdown in Wuhan is affecting a whole host of local high-tech companies. They range from manufacturers of display panels, memory, fiber optics, auto parts to suppliers of components, bio-medicine and medical devices. Here’s who’s who.

 

Coronavirus Tests Tech’s Supply Chain Resilience

By Barbara Jorgensen

Standing still is not an option for an industry renowned for innovation. Companies can still take steps to mitigate the impact of the outbreak

 

Events Across SE Asia Cancelled Due to China Virus Outbreak

By Brian Santo

As concerns about the latest coronavirus escalate, events are getting delayed or canceled, at no small cost. Semi has put off Semicon Korea and Semicon China.

 

Is Shenzhen Going Viral?

By Junko Yoshida

It’s not just in Wuhan. Also in Shenzhen, all shops and restaurants are closed except some supermarkets and pharmacies.

 

China Maintains Chip Output in Wake of Virus Outbreak

By Barbara Jorgensen

It’s hard to square the “all is well” stance in China’s chip sector with reports from other markets. The outbreak will create a significant near-term reduction in LCD production in China, says IHS Markit.

 

Supply Chain Poised for Coronavirus Disruption

By Barbara Jorgensen

Crucial to the electronics industry in this crisis is the trifecta of a US/China trade war, Brexit in Europe and supply-chain uncertainties triggered by the coronavirus.

 

Outbreak in Wuhan: an Aspencore Special Project

By Junko Yoshida

Aspencore Media, a publishing house that owns EE Times, has launched a Special Project, “Outbreak in Wuhan,” seeking to define the global impact of the deadly virus in the electronic industry. This is the introductory article to the special project.

0 comments
Post Comment

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Related Articles