Ventec is cautiously observing the situation

As previously reported by Evertiq, the Chinese government has extended the Lunar News Year holiday with an additional three days to limit the opportunity of the virus spreading. The government has also put in place travel restrictions around Wuhan and the Hubei province. As Ventec writes in a statement, the company’s mainland China facilities are centered in and around Suzhou in Jiangsu Province, with a pressing facility in Shenzhen, Guangdong Province, both of which are many miles from the center of the outbreak, and there are no governmental travel restrictions in place to and from these cities. Certain regional governments have further extended factory reopening dates until Monday 10th February. And the current plan for Ventec is to have its Suzhou factory reopened on the third of February (with limited head count), and the Jaingyin and Shenzhen factories are set to reopen on the 10th of February. The company says that as the Suzhou facility ran manufacturing right up to the 24th of January – the day before the start of the Lunar New Year – the company has a good level of finished goods inventory at the Suzhou warehouse. However, the full impact on production output cannot be assessed until next week when management and employees are able to return to the factory. “Our understanding is that China Customs, reopens on Monday 3rd Feb, with reduced manning levels, to limit the transmission risk to its employees. This is expected to lead to extended export clearance times. This will have the biggest impact to air freight shipments. So far, we have no means of estimating what the delay time will be, but we will update this information as it becomes clear,” the company writes in the statement. Adding to this, many airlines have announced cancellations to some, or all flights, to and from the Chinese mainland – at least in the short term. This will further impact on lead-times as capacity is significantly reduced. Ventec says that it has manufacturing capability and capacity in Taiwan, that can be used to support the mainland China facilities, should this become necessary as the situation develops.