Virus hits local computer supplies

Virus hits local computer supplies

Acer and Lenovo among firms affected by prolonged closure of Chinese factories

Visitors browse laptop computers and tech accessories at Commart Work 2019 at Bitec in December. (Post File Photo)
Visitors browse laptop computers and tech accessories at Commart Work 2019 at Bitec in December. (Post File Photo)

The Covid-19 virus outbreak is affecting IT product supplies in Thailand with giant computer manufacturers Acer and Lenovo indicating the temporary closure of factories in China has caused inventories to drop by up to 30% in the first quarter.

The IT research firm IDC predicts PC sales in Thailand this year will remain flat at best because of the short supply and lacklustre business investment.

“Covid-19 is affecting the global computer market supply chain as the majority of computer production is in China and these factories have temporarily closed their operations,” said Alan Chiang, managing director for Thailand and Indochina at Acer Computer.

In the first quarter, Acer’s product supply fell 20-30% from normal levels, he said, adding that if the factories cannot resume operations soon, this would hinder the supply in the second quarter.

Acer, the fifth largest PC vendor in the world, also has plants in other countries, such as the Philippines and India, and they may have to increase output to fill the void.

Mr Chiang said Acer had postponed new product launches, earlier planned for March, to the second quarter due to the short supply and lack of consumer sentiment.

“It is hard to forecast overall PC growth this year as we are still in the period of uncertainty,” he said.

Takon Niyomthai, consumer lead of Lenovo Thailand, the local operating unit of the world’s largest computer maker, said the prolonged closure of the Chinese factories after Chinese New Year caused the delay of shipments by 2-3 weeks in the first quarter.

Customers have been informed about the delay, he said.

Mr Takon said Lenovo saw a 20-30% drop in the supply in the first quarter but there is no shortfall of inventory in the domestic market.

In some countries where 5G-enabled devices are planned to be launched, they could be affected by the lack of supply.

However, some computer components, including SSD storage and RAM memory, are becoming more expensive.

“We expect the overall PC market in Thailand to see flat growth at best this year due to shrinking demand due to the stagnant economy as well as the supply impact in the first quarter,” he said.

Peerapat Samarnmit, a market analyst at IDC Thailand, said the overall PC market locally would be flat this year or could even contract, weighed down by the virus outbreak, listless investment sentiment along with the delay of government budget spending.

Weeradej Panichwisai, senior research manager of IDC Thailand, said the firm had revised down its PC sales projection this year as a result of the virus outbreak affecting the supply chain.

“We estimate in the first quarter PC sales in Thailand will drop 10% from the same period last year,” he said.

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