China Shipments Stranded At Ports Leave Smartphone-Makers In A Fix

Many of the smartphone component shipments come from China.

The Indo-China bilateral clash is having a trickle-down effect on the smartphone industry as many shipments have remained stranded at various ports which have left many smartphone brands in India panicking.

According to an Economic Times report, shipments from China have been standed at ports since Monday 22 June, which has affected the electronics manufacturing industry.

The shipments that mostly carry parts and components for smartphones have been stopped for manual checking and this has caused delays and the entire supply chain has been disrupted.

Smartphone-Makers Being Stalled

“Shipments in Chennai and Delhi have been halted and now there will be a physical checking of all imported goods… this is spooking the industry as it will soil and damage imports which are critical not just for domestic production but also for exports out of India.”

Pankaj Mohindroo, Chairman, Indian Cellular & Electronics Association speaking to ET.

Lava, Oppo, Foxconn and Vivo are some of the members of the ICEA.

Speaking to The Quint, a Xiaomi spokesperson said that "it is a developing scenario and the company is monitoring the situation closely."

A while back we had spoken with some smartphone manufacturers such as Vivo, Realme and OnePlus who told us that they were operating at a lower capacity due to the lockdown.

Even now, most of these smartphone-makers are operating at almost 40 percent capacity due to the shortage of labour and protocols being followed due to COVID-19. The delay in shipments comes as another blow as most of the components come from China.

Why Are Shipments Stuck At Ports?

As per the report, under the Risk Management System (RMS), only the consignments that were designated as “high risk” were to undergo a thorough manual check while other shipments could be released with proper permits and approvals based on self-certification.

However, the Indian government has excluded Chinese consignments from this category and have instructed for them to be examined thoroughly.

Most of these imports carry components that are fragile and manual checks could lead to damage. Also, a delay of more than 24 hours disrupts the supply chain and manufacturing of units that function on a just-in-time inventory model.