The recent coronavirus outbreak isn’t just stopping travel to and from major parts of China, it’s also expected to affect the global consumer electronics industry – which is heavily reliant on the country. Noted Apple analyst Ming-Chi Kuo has posted a new research note which predicts that the ongoing coronavirus outbreak could affect Apple’s supply chain, directly affecting iPhone shipments in the first half of 2020. Apple had recently shut down its retail stores in China as the country battles the Novel Coronavirus outbreak.
In his latest research note, as seen by Apple Insider, Kuo said that overall smartphone shipments will drop in China which will end up ‘hurting’ Apple as well. The tech giant’s supply chain in China will also impact the company’s overall shipments. Kuo further added that Apple’s products will face production risks due to the coronavirus outbreak as some factories will remain closed temporarily.
Kuo’s latest research note claims smartphone shipments in the Chinese market will decline by 15 percent year-on-year to a little over 310 million in 2020. The analyst blames it on ‘negative impacts on consumer confidence’ due to the ongoing coronavirus outbreak in China.
In addition, Kuo further notes that iPhone’s supply is being affected by the coronavirus outbreak, resulting in a drop in iPhone shipment forecasts by up to 10 percent in the first quarter of 2020.
With travel restrictions in place, Apple employees won’t be able to visit suppliers in China for testing products and other operations related issues. This may end up delaying products that could be in the pipeline for later this year as well.
Apple has also closed all its offices and retail stores in mainland China until February 9. Apple supplier Foxconn had earlier assured that it plans to continue working towards meeting all its production obligations despite the novel coronavirus outbreak in the country. Apple won’t be the only company though, several Chinese phone brands will also be impacted due to the coronavirus outbreak.