Coronavirus hitting China’s manufacturing sector worse than Sars as Covid-19 slows production

Nantong-based Foremost have only managed to return to 80 per cent capacity with migrant workers struggling to return after the Lunar New Year holiday

The Chinese government has been keen for economic activities to resume after the outbreak, which has claimed over 1,300 lives and infected over 60,000 people

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Foremost, which is based in Nantong, a city 150km north of Shanghai in the eastern Jiangsu province, has yet to be able to return to full capacity. Photo: Foremost

Published: 8:30pm, 14 Feb 2020Updated: 8:38pm, 14 Feb 2020

For Huang Meiyun, deputy manager of a hat manufacturer and retailer from Jiangsu, the coronavirus outbreak could not have come at a worse time.

“Originally we had plans to deliver our products [after the Lunar New Year holiday],” said Huang, who works at Foremost in Nantong, a city 150km north of Shanghai in the eastern Jiangsu province.

“Because of the outbreak, we just couldn’t do it. Customers have been chasing us. It’s not just about orders being cancelled now, we have had to adjust as well [for the delay in production].

“We’ve never encountered this kind of situation before. We have had sufficient orders and things have been running smoothly. It is really the first time, not even during severe acute respiratory syndrome (Sars) [we had to deal with factory closure].”

If it gets worse, we may be only able to pay the basic rates for a little bit longer. I hope the situation will be improve as soon as possible.

Huang Meiyun

The outbreak, which has infected more than 60,000 people, has severally hit the manufacturing sector, with Hubei province, the epicentre of the outbreak which has been under a lockdown, home to almost 11 million migrant workers in 2018, according to the provincial government.

While China has pushed to automate its manufacturing sector, many factories remain relatively labour intensive, and factories such as Foremost are becoming wary of cash flow issues having lost orders.

“Right now we can afford to pay up to four months of wages,” Huang added. “But if it gets worse, we may be only able to pay the basic rates for a little bit longer. I hope the situation will be improve as soon as possible.”