Supply chain operations out of China face pressure by lockdown measures

Supply chain and logistic operations out of China face further pressure over the coming weeks as a series of new lockdown measures have been put in place in Shanghai and Shenzhen.

Shenzhen – a city of 17.5m people with a large manufacturing base – has gone into lockdown for at least seven days forcing several companies to pause manufacturing activities in the city as China deals with its worst outbreak since 2020.

Foxconn – which manufactures products for Apple and Samsung – is the most high profile company that will be affected as the city has told non-essential businesses to close, while public transport is shutdown and people are urged to work from home.

Many other manufacturers will also be hit by the restrictions.

On the transport front, the city is also home to several shipping ports, including Yantian, one of the largest container terminals in China.

Restrictions are also being put in place in other cities. Shanghai Pudong Airport has diverted more than 100 international flights, which will put pressure on bellyhold operations.

A statement from the Civil Aviation Administration of China (CAAC) on March 15 said the move, which takes effect March 21 through July, will affect 106 flights operated by five airlines — Air China, China Eastern Airlines, Shanghai Airlines, Juneyao Airlines, and Spring Airlines.

The measures are not expected to affect freighter operations.

The move is designed to ease the pressure on Shanghai’s Covid management measures.