With China a vital link in many manufacturing supply chains, the coronavirus’s impact is shaking the global economy. In fact, it is one of the reasons equities have declined three days in a row.
Today, Apple, the most valuable company in the U.S., cautioned that it does not expect to meet its quarterly revenue forecast, citing slowed production and weakened demand in China as a result of the coronavirus outbreak.
Wuhan, the city of 40 million where the outbreak began and the center for China’s production of vehicle parts and accessories, has been drastically quarantined and much of its industry has been shut down.
Hyundai closed its South Korean assembly plants in early February and Fiat Chrysler has announced one of its European plants will run out of parts from China in less than two weeks and could halt production. Volkswagen delayed re-opening its Chinese plants after the January Chinese New Year holiday week until 17 February.
Because a third of manufactured items imported into Indonesia, the Philippines, South Korea, and Vietnam come from China, those economies will suffer also.
The ripples extend beyond Asia. Due to China’s economic slowdown, the country is importing less copper from Chile and Nigeria, for example.
