Skip to main content

Coronavirus Effects on Logistics

The World Health Organization has officially declared the coronavirus a global emergency due to the climbing death toll in the city of Wuhan, China. With over 100 deaths being recorded in the country the entire city has been put on lock down. Major airlines in Europe, Asia, and North America have announced flight cancellations to and from Wuhan, while the city is under mandatory quarantine.

Macau Photo Agency

What does this health epidemic mean for logistics? Well for starters – Wuhan, China is hub to manufacturing companies including Nissan, Honda, and GM. (Other companies include IBM, HABC, Honeywell, Siemens, and Walmart.)

These companies were already expecting delays due to the 3-4 week closures that take place annually in honor of Chinese New Years. More than likely this window will be extended in response to the transportation restrictions. Delayed openings of factories alone, suggest major production slow downs, increased blank sailings, and slowed down port operations.

Unfortunately it is difficult to distinguish if the slow-downs are due to the New Year or the virus. What we can predict long-term is, a decrease in logistic contracts, loss of revenue, and an overall economic slowdown. Not to mention the various industries and commodities that will take a major hit due to shipping delays.

Retailers, tourists, and transportation companies are said to be the first to experience the initial effects of the outbreak. Sources are labeling this as a black swan event that will continue to unfold and its lasting/long-term effects will remain unknown until a treatment is found. Jonathan Ball virologist at the University of Nottingham, UK. says “A vaccine would take at least a year, if not more,”
Read more:

Don’t forget to sign up for our e-newsletter so you can get the best of our blog on a monthly basis straight to your inbox!

We offer competitively low prices, end-to-end solutions, and one-on-one attention for every client– large or small. Contact us today to see how we an fulfill your logistics needs!