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Saturday, March 28, 2020

Companies feel impact of coronavirus outbreak in China

Across the world, companies have warned that an outbreak of coronavirus in China could disrupt supply chains or hurt bottom lines.

By: Reuters | Updated: February 3, 2020 3:44:24 pm
China, China coronavirus, China virus, China Lunar New Year, China virus cases, China coronavirus infection More than 200 confirmed cases of patients with the coronovirus symptoms included fever, coughing and difficulty breathing.(AP Photo/Eugene Hoshiko)

Companies around the world have warned that a coronavirus outbreak in China could disrupt supply chains or hurt bottom lines as factories and shops shut and airlines suspend flights.

FINANCIAL IMPACT:

* Apple gave a wider-than-usual revenue outlook range for the March quarter to factor in uncertainty. Apple, which has suppliers in Wuhan, the central Chinese city at the heart of the outbreak, said the reopening of some suppliers’ factories outside Wuhan had been moved to Feb. 10 from the end of January.

* Baidu postponed the announcement of its fourth-quarter results.

* Electrolux said the epidemic could have a material impact if its Chinese suppliers were further affected and that it was implementing contingency plans.

* H&M said store closures in China – about 45 – hurt sales in January. The company said it sources “a lot” from China but its flexible supply chain had limited disruptions.

* Hyundai Motor said it planned to halt South Korean production of a sport utility vehicle to cope with a supply disruption.

* Jaguar and Land Rover parent Tata Motors expects the outbreak to hamper production in China and hit profits.

* Levi Strauss shut about half its stores in China and said it will take a near-term hit.

* LG Display said it had not closed any factories in China but warned the outbreak increased uncertainty for suppliers.

* McDonald’s, which closed several hundred of its roughly 3,300 outlets in China, said the overall impact on profits would be “fairly small” if the virus stayed contained in China.

* Remy Cointreau warned that a potential impact from the outbreak would be significant because of its big exposure to China.

* Royal Caribbean Cruises, which cancelled three trips of its China-based cruise liner, trimmed its 2020 earnings forecast, adding it would take a further hit if travel restrictions continued until the end of February.

* Samsung Electronics extended a holiday closure for some factories in line with Chinese government guidance but declined to comment on the impact.

* Samsung affiliate and battery maker Samsung SDI , which counts Volvo among its customers, warned of a hit to its March-quarter earnings.

* SK Hynix, which has a chip plant in the eastern Chinese city of Wuxi, said the outbreak had not disrupted production but that could change if the situation was prolonged.

* Starbucks, which closed more than half its roughly 4,300 stores in China, delayed a planned update to its 2020 forecast and said it expects a material but temporary hit.

* Tesla warned a 1-1.5 week delay in the ramping up of production of its Shanghai-built Model 3 cars could slightly hurt March-quarter profit after China ordered a shutdown of the factory. Tesla is also evaluating whether the supply chain for cars built in its California plant will be affected.

STORE/FACTORY CLOSURES:

* Apple said on Saturday it would shut all of its official stores and corporate offices in mainland China until Feb. 9.

* Alphabet’s Google temporarily shut all offices in China, Hong Kong and Taiwan.

* Deere & Co closed facilities in China until it determines it appropriate to reopen them.

* Fast Retailing closed about 100 Uniqlo stores in Hubei.

* Haidilao shut its restaurants and IKEA closed its stores in China.

* Honda plans to extend the closure period for its three car plants in Wuhan, which it operates with Dongfeng Group , until Feb. 13.

* Swatch closed five stores in Wuhan, Yum China closed some KFC and Pizza Hut stores in the city, Luckin Coffee closed its cafes and AB Inbev suspended production at its brewery.

* Toyota Motor shut factories in China through Feb. 9.

* Walt Disney shut its resorts and theme parks in Shanghai and Hong Kong.

AIRLINE CANCELLATIONS:

For airlines suspending flights to China, please click on

HOTELS, BOOKING PLATFORMS, AGENCIES:

* Hyatt and Shangri-La said they will allow travellers from China to cancel hotel bookings for free through Feb. 29.

* InterContinental Hotels said it would allow customers to cancel for free reservations made for China for specific dates. .

* Ctrip, China’s largest online booking platform, said more than 300,000 hotels on its platform had agreed to refunds on bookings between Jan. 22 and Feb. 8.

* Fliggy, Alibaba’s booking site, offered similar refunds, as did several Chinese and European tour operators.

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