Implications on Corona Virus on Global Supply Chain
Coronavirus, formally known as covid -19 infections, has caused immense disruptions in the global business sector. The virus, since its outbreak in china in 2019, has affected supply chains and disrupted manufacturing operations forcing thousands of companies to temporally shit down in Asia, Europe, and in the USA. According to most affected companies are those that rely heavily on Chinese parts and materials. Moreover, the suggest that covid 19 impacts will be more severe than that of the 2002-2003 SARS epidemic. The Chinese market has also been affected as people are not spending hence reducing both inflow and outflow of goods. Apple has reported that its demand for iPhones in the china market has diminished and consequently raising alert o reduced profits of the first quarter of 2020.
China is a global business leader, as it supplies critical materials to many global companies. Also, it offers the shortest lead time as it delivers its materials within 30 days; hence temporally closure of manufacturing plants will significantly affect their production. Several companies in recent times have announced throttle back production in their plants dependent on Chinese raw materials. Fiat Chrysler automobiles have announced the closure of its Serbian car plant since it can get parts from china. Similarly, Hyundai has suspended its production in Korea due to supply disruptions of parts from china. Moreover, Forbes argues that covid 19 has resulted in the supply-chain bullwhip effect that disrupts both supply and demand and that the most vulnerable companies are the small and average companies suppliers found at the top of supply chain order.
In summary, covid-19 impact on the global platform is dire, and the future implications are unknown as the virus cure has not been established. Moreover, the supply of goods and services have been affected by the minimal movement of people and products has been temporally disrupted. In some parts such as china, people have put in quarantine, thus halting productions and overall global supply chain.