The coronavirus is starting to impact the technology industry’s global business. Apple and Google, among others, have begun closing stores and offices, limiting business travel to China and bracing for supply chain disruption as health officials around the world seek to contain the disease. The GSMA, the group that organises Mobile World Congress, said it would have additional medical personnel on-site when the conference opens in Barcelona on February 24.
On Friday, the US government issued a federal quarantine for 195 Americans evacuated from the epicentre of the virus, marking the first such quarantine in half a century. The World Health Organisation on Thursday declared the 2019-nCoV strain of the virus a public health emergency of international concern, citing worries about its spread, particularly to countries “with weaker health systems.” The death toll has risen to at least 350 and the number of infections has passed 17,000.
The virus was discovered in the Wuhan region of China late last year, and causes symptoms that are similar to pneumonia. It was first reported to the WHO on Dec. 31, with Chinese scientists linking the disease to a family of viruses that includes SARS and MERS (Middle East respiratory syndrome).
The virus has infected over 17,000 people in China, according to the WHO, and infections have been found in more than a 20 countries. Nine cases have been identified in the US, where the disease has spread person to person. It’s also been found in Australia, Europe, the Middle East and other parts of Asia.
Airlines have begun curtailing flights to China. United Airlines has suspended operations between its hubs and Beijing, Chengdu and Shanghai beginning February. 6 through March 28. The airline says it will operate “select flights” to ensure US-based employees and customers can return home, It will also fly one daily flight between San Francisco and Hong Kong. Other airlines either cancelling China flights or extending travel waivers include American, Air Canada, British Airways, Cathay Pacific, Delta, Lufthansa, Austrian, Swiss and Finnair.
The Allied Pilots Association filed a lawsuit seeking a temporary restraining order to suspend American’s US-China flights citing the “serious, and in many ways still unknown, health threats posed by the coronavirus.” American Airlines acknowledged the lawsuit and said it’s in touch with health authorities to “make sure we are taking all necessary precautions for our customers and team members.” A US flight attendants union is also urging flights to China be cancelled until the outbreak is contained.
Many tech companies are monitoring the situation closely and have curtailed non-essential travel. Lenovo, the Chinese laptop maker, said it was avoiding large face-to-face meetings and allowing more people to work from home until more is known about the outbreak. HP has implemented some travel restrictions for employees going to and from China. Mozilla, which makes the Firefox browser, is making masks and hand sanitiser available. Facebook and Twitter are suspending non-essential travel to China, while Nintendo reportedly said production of its popular Switch handset in China was “seeing some impact from the coronavirus.” Five factories that make LCD and OLED panels are expected to see slowdowns in production, according to IHS Markit, a research firm.
Those companies aren’t alone. Here’s how the virus is impacting some of the biggest names in tech.
The iPhone maker has temporarily shuttered all of its stores in mainland China, one of its biggest and most important markets. Apple is also closing its corporate offices and contact centres in China until February 9.
“Our thoughts are with the people most immediately affected by the coronavirus and with those working around the clock to study and contain it,” Apple said in a statement Saturday, according to CNBC. “Out of an abundance of caution and based on the latest advice from leading health experts, we’re closing all our corporate offices, stores and contact centres in mainland China through February 9.”
During its earnings call on January 28, CEO Tim Cook said “a number” of Apple’s retail partners have closed their locations as well.
Apple has suppliers in the Wuhan area but also has alternative sources for the components they provide. The company is “working on mitigation plans to make up any expected production loss,” Cook said. What’s less clear is how the coronavirus will impact suppliers in other parts of China, he said.
The Chinese government extended the Lunar New Year holiday break from the end of January to February 10, which will delay the startup of Apple supplier factories, Cook said.
The search giant said Wednesday that it was temporarily closing all of its offices in mainland China, Hong Kong and Taiwan due to the health threat. The tech giant has also placed restrictions on business travel to China and Hong Kong.
Google employees in China and those with immediate family members returning from China have been told to work from home for at least 14 days at least. Google’s China business focuses mainly on sales and engineering for its advertising business.
The online retail giant says it has restricted business travel to China unless there’s a “business critical reason.” The company has also recommended that employees who have returned or will be returning from an affected Chinese province work from home for 14 days. If they experience any symptoms, they’ve been asked to get a medical consultation before returning to the office.
“We place tremendous value and focus on the well-being and safety of our employees,” a spokesperson said in a statement. “Out of an abundance of caution, we are restricting business travel to and from China until further notice and encouraging our employees to follow the health and safety guidelines provided by international health agencies such as the CDC (US Centers for Disease Control and Prevention) and WHO.”
The software giant has advised China-based employees to work from home and cancel all non-essential business travel until February 9. It’s also advised employees to avoid non-essential travel to China based on the CDC’s recommendation. Microsoft has said it will make a 1 million RMB ($144,000) donation to the Hubei Red Cross Foundation to help with relief efforts in Wuhan and surrounding areas. The company estimates the risk to employees is low, and no employee has been affected at this time.
Microsoft maintains a global health response team that’s mobilised to protect employees based on an evaluation of recommendations by global health authorities, such as the WHO and the CDC.
The electric car maker is closing its new plant in Shanghai for up to a week and a half after the Chinese government told private companies to temporarily cease operations. CFO Zack Kirkhorn told investors about the mandatory closure during the company’s fourth-quarter earnings call. The shutdown may “slightly” affect first quarter profits, he said.
The closure comes shortly after Tesla had begun ramping up production at the facility. All private facilities will remain closed until February 9, though utility firms and health care industries remain open.
The home rental service said it would offer guests and hosts affected by coronavirus the opportunity to cancel reservations without penalty. The policy applies to hosts or guests in Hubei Province, where Wuhan is located, with reservations between January 21 and February 8, as well as any guests already staying in Hubei.