Supply chain disruptions happen all the time. Transmissions arrive late at an auto assembly plant. Size 2X T-shirts are in short supply for screen-printers. A weather irregularity bumps the avocado market. Most such problems are short-lived and affect a relatively small portion of the overall marketplace.
But the coronavirus is breaking many chains across a swath of the global economy. The effects may be widespread, deep and lingering.
The virus is spreading alarmingly quickly and amazingly far. The broader world became aware of the coronavirus when China alerted the World Health Organization on Dec. 31 about some cases of unusual pneumonia in Wuhan, a city of 11 million people. Within a week, officials realized they had a new virus on their hands. The first related death was announced on Jan. 11.
Shanghai Disneyland shut down on Jan. 24, just one of many entertainment venues in China that closed in an effort to slow the virus spread. The same day, the number of cities in China on lockdown rose to 13, affecting 41 million people. The death toll rose to 170 in China by Jan. 30, the day the Philippines and India confirmed their first cases of the virus. The next day, cases were confirmed in Sweden, Spain, Russia and the United Kingdom.
China reported it had suffered 1,016 deaths among its 42,638 confirmed cases of infection. The worldwide death toll topped 3,100 by Tuesday, when more than 73 nations had reported a total of 90,000 people infected with coronavirus. The first U.S. deaths were reported over the weekend in Washington state.
The loss of life is tragic. All other coronavirus-related concerns pale in importance next to the death toll.
But there are other concerns. Stock markets have plunged. Supply chains are breaking. The effects are being felt across the globe, including in Traverse City.
One small example: I received notice three weeks ago that delivery of a product I had ordered from Grawn-based Altus Brands would be delayed. Component warehouses in China were locked down, an email from Altus said. The company sent an update late last week, that tooling was on track to be delivered to the factory, and the product might be delivered only a month or so later than the original target date later this spring. That’s just a momentary blip in the consumer world.
Apple two weeks ago told investors iPhone production would take a hit, so its financial expectations dipped. That’s a bigger blip.
Other supply chain issues hold much more serious implications.
The Associated Press on Friday reported that Americans may have trouble getting some medicines in coming weeks. Pharmaceuticals flow back and forth across the world’s trade routes, and much of that flow is from East to West. About 80 percent of the ingredients used in U.S. medicines, the AP reported, are created abroad — most of them in China where labor and materials are least expensive.
China is a major producer of antibiotics used in the U.S., and of ingredients and medicines used to treat common chronic conditions like heart disease. China also is the top exporter or medical equipment and devices sold in the U.S., the AP said.
Globalization allows businesses to source ingredients, components and labor where it is less expensive. Global supply chains normally work well, like a properly lubricated bicycle chain. But when one link in a chain breaks, the entire chain is instantly rendered useless.
When my bicycle chain snapped during my college years, all I had to do was walk to campus for a couple of days, spend a few bucks on a new chain and get my hands dirty. Then I was back in the business of spinning my wheels.
The situation is more complicated — and more critical — when we’re talking about the supply chain that handles life-saving pharmaceuticals.
Companies in recent years have been sourcing more and more things from China. Coronavirus has broken the supply chain for electronics, for pharmaceuticals, for who knows what else.
Hopefully, the pharmaceutical lines of supply will limp along well enough to keep patients everywhere — including in the U.S. — healthy.
Slowing the human toll of coronavirus is job one. Maintaining the available supply of medicines for chronic illness is a close second.
Only after the medical community has the outbreak under control will the world be able to get the clanking machine of global commerce back up to full speed. It will take awhile to get manufacturing supply chains moving again.
In the meantime, we all hope that authorities can control the virus and stop its deadly spread.
