Technology Manufacturing In The Epidemic Situation: Reemployment And Delayed Short-Term Restraint Will Not Affect The Medium And Long Term Trend.

As of 24 February 4th, the total number of confirmed cases of new coronavirus infection in China was 24324, with 23260 suspected cases and 490 deaths.

As the epidemic is still in the diffusion stage, in order to strengthen the epidemic prevention and control work, the State Council extended the Spring Festival holiday in 2020 to February 2nd, and some areas were extended to mid February. With the delay of reemployment and the impact of the international trade environment caused by the epidemic, China's science and technology manufacturing industry is facing some challenges in the short run.

"The epidemic has adverse effects on the supply side and demand side of China's manufacturing industry." Li Xiaohua, a researcher at the Institute of industrial economics of the Chinese Academy of Social Sciences, told the twenty-first Century business news reporter that due to the fact that a large number of returning workers could not return to work on time, the whole manufacturing industry chain had poor production capacity, and the demand side also caused a decline in the corresponding manufacturing products due to the shrinking consumption under the epidemic.

However, in the medium to long term, Li Xiaohua expressed confidence in the recovery of China's manufacturing industry. In his view, after the end of the epidemic, it is estimated that there will be a rebound in the manufacturing sector's year-on-year growth rate. Meanwhile, China's manufacturing industry still has an irreplaceable advantage in the world. "The world market can not be separated from China's manufacturing".

Manufacturing industry faces challenges

Because Wuhan is the central city of epidemic situation, Hubei, especially the local manufacturing enterprises in Wuhan, bear the brunt.

"Wuhan is one of Lenovo's manufacturing base, and Wuhan's industrial base is the largest and most advanced self owned factory in Lenovo." Qi Yue, senior director of manufacturing in China, Lenovo Group MBG, told the economic news reporters in twenty-first Century, "in another sense, every lenovo mobile phone has gone through the Wuhan base."

In July of last year, the Wuhan factory put out first billion smartphones. This is another important milestone in Lenovo's intelligent manufacturing after the 100000000th personal computers in Hefei in 2018. But now, Wuhan is "sick" and the Lenovo Group, rooted in Wuhan, is also inevitably affected.

"The delay in the resumption of work, coupled with the forefront of this epidemic, is one of Lenovo's base camp in Wuhan. These factors will inevitably bring short-term production lag to Lenovo." Lenovo introduced to the twenty-first Century economic news reporter.

In addition to Lenovo, BOE, a global leader in display panels, has also poured blood into Wuhan. According to Jingdong direction twenty-first Century economic report reporter, BOE Wuhan 10.5 generation TFT-LCD production line has been mass-produced in December 2019, is currently in production capacity to climb and improve yield.

"Affected by the epidemic prevention and control measures, production related materials supply is facing some pressure." BOE said, "under this background, the 10.5 generation line of Wuhan will be reduced monthly production plan, and it is expected that the release rate of production will slow down, which may further exacerbate the continued shortage of supply and demand of the global super large display screen in 2020."

Ozawa Hideki, chairman and chief executive officer of Canon (China) Limited, said that except for Hubei Province, all Canon Chinese institutions resumed their working hours on February 10th, but the resumption time of their Wuhan branch was determined according to the local epidemic situation.

"According to the relevant policies of China and local governments, some Canon factories in China are still in a state of being unable to return to work. Although there is no way to predict the impact on the actual business, we will also confirm the specific impact on business in the future as the recovery of production and the beginning of logistics and transportation begin." Ozawa Hideki pointed out.

In addition, according to the 2019 Wuhan municipal government's work report, optoelectronic information, automobiles and parts, biomedicine and medical devices are the three pillar industries in Wuhan. This means that the manufacturing industry in Wuhan is delayed, and the related industry chain such as electronics, automobile and medicine may be faced with a certain shortage of risk.

In addition to local enterprises in Wuhan, labor intensive manufacturing enterprises across the country will also be affected by postponed resumption.

According to media reports, enterprises affected by the epidemic, including Samsung Electronics and LG electronics, have announced a suspension of some business operations in China. On February 4th, Samsung's flagship store (the Bund), the largest store in China, will be suspended until February 9th, and other stores will be decided separately according to the epidemic situation.

Since last weekend, the LG chemical battery factory and LG display module factory in Nanjing have been shut down until February 9th, and LG chemical Beijing, Guangzhou polarizer, Tianjin auto parts and other factories have also been shut down. At present, Foxconn has also stopped production in China and is tentatively scheduled to resume production in February 10th. If Foxconn continues to shut down, it may lead to insufficient supply of iPhone.

Does not affect the medium and long term trend

Despite the impact of the epidemic, postponing short-term reemployment and other factors will form a challenge related to the manufacturing industry chain, but the industry believes that the impact of postponed resumption on labor-intensive manufacturing enterprises is relatively large in the early stage, and the latter should be relatively small.

In addition, enterprises with global layout will be better able to cope with the epidemic. "With the help of Lenovo's global manufacturing and distribution network, we can minimize the potential impact of this epidemic on consumers." Lenovo told the twenty-first Century economic news reporter, "Lenovo's global layout gives us confidence to better cope with challenges."

BOE also pointed out that it will actively adjust its business strategy and cooperate with the upstream and downstream to minimize the impact of the epidemic prevention and control.

It is worth mentioning that viruses directly encroach on the human body, and the degree of automation and intelligence is higher.

"Although the epidemic will inevitably bring short-term impact on China's manufacturing industry, it will not affect the long-term operation." Lenovo pointed out that "with the development of technology, the overall automation level of China's manufacturing industry has been greatly enhanced, and the risk and repair capability of China's manufacturing industry has been greatly enhanced."

In fact, as an early manufacturing country, China has a complete manufacturing industry system and a wide range of application scenarios. The explosive growth of emerging technology enterprises ranks the highest in the world. According to McKinsey's 2019 global "lighthouse factory" network, China has 7. This shows that China's intelligent manufacturing development has certain representativeness.

Take Lenovo as an example. As early as 2013, Lenovo Group started the intelligent transformation with data intelligence as its core, and made use of its own technology to form an intelligent technology and management system covering the whole value chain of "research and production, supply and marketing service". In the production process of a mobile phone in Lenovo Wuhan base, in addition to the generally recognized difficult automated assembly parts in consumer electronics production, the factory has greatly improved production efficiency and greatly reduced production costs.

Focusing on the development made in China after the epidemic, Li Xiaohua suggested that, on the one hand, China's manufacturing industry should strengthen the development of the emergency industry, aiming at the rational distribution of capacity and distribution of products needed for emergency situations. At the same time, enterprises should also vigorously promote intelligent manufacturing, "to reduce production dependence on workers, and to increase the flexibility of production, so that capacity can be adjusted at a lower level according to demand changes."

In addition, Li Xiaohua pointed out that manufacturing enterprises should be encouraged to adopt information technology to carry out the digitalized transformation of operation and management, and carry out service manufacturing, and carry out value-added services around core products, so as to make service activities an important source of income for enterprises.