Coronavirus wreaks havoc among electronics firms in February ISM says
Boeing Co.
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11:09 03/06/25
Factory sector activity in the States slipped last month as the Chinese coronavirus left its mark on businesses, wreaking havoc among electronics firms and triggering layoffs among makers of transportation equipment.
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The Institute of Supply Management's manufacturing sector Purchasing Managers' Index retreated from the 50.9 level in January to 50.1 for February.
Economists had penciled-in a reading of 50.5.
Yet note should be taken that headline PMI would have been weaker still if not for the increase in the sub-index for supplier deliveries, which rises when deliveries slow, but this time the slowdown was the result of snarled supply chains, not strong demand.
The sub-index for supplier deliveries gained from 52.9 for January to 573 in February.
According to one purchasing manager from the Computer and Electronic Products sector, the virus was "wreaking havoc" on the electronics industry.
"Companies are delayed in starting up production, which is resulting in longer lead times, constraints and increased pricing. It's a mad dash to dual source stateside in case China isn't back online soon," that same manager said.
Another manager, from the Chemical Products space, said the virus and the grounding of the Boeing 737 Max were both taking their on new orders, but for the full-year sales were expected to be between flat to slightly up.
A survey respondent from a transportation equipment maker was more succinct, telling ISM: "layoffs are here".