With the coronavirus epidemic still challenging, Chinese home appliance makers mostly take proactive actions to deal with it rather than stay in early surprise. From shipping products to Wuhan to help in the wake of the outbreak, to efforts in disinfecting factory, monitoring the epidemic situation and checking up health condition of employees, the industry is ready to resume production anytime. After rounding up information from various sources, CHEAA actively communicates with its members and reminds them to prepare for any challenges ahead amid the complicated epidemic situation, and at the same time, actively prepare to resume production.

The overall production resumption can be expected though quite challenging in short term

It is learned that, most home appliance makers as well as relevant suppliers have resumed production gradually since February 10, 2020. But enterprises in some regions extended the holiday in accordance with the policy of local governments, with those in Jiangsu and Zhejiang provinces expected to resume production after February 17 and those in Guangdong province after March 1. Considering the regional differences in epidemic situation prevention and control as well as the challenges facing enterprises, it doesn’t seem possible to see an overall production resumption in short term, which is largely due to insufficient protective equipment for frontline workers.

The production and operation of home appliance industry will definitely be affected with people restricted to move during the outbreak. At the same time, home appliance consumption could shrink down the road considering the employees of those hard-hit industries, who are also consumers of home appliances, might suffer a salary cut after the containment of the epidemic. Based on the feedbacks we got, sales in Q1 will be severely impacted. This, coupled with foreseeable challenges in logistics, supply chain, raw materials and labor cost, will surely bring down the overall profit of the industry.

In medium and long term, the impact will be complicated, covering the deployment of industry chain, cash management, product R&D, sales pattern, etc. But there are opportunities too. Home appliance industry is resilient. The fast progress in smart manufacturing progress in recent years allow the industry to run efficiently, which means the manufacturing process will not heavily hit and the industry is capable of restoring capacity soon as soon as the production is resumed. On top of that, the coronavirus outbreak draws all eyes on the concept of “healthcare” and “anti-bacteria”. This could boost the rise of products with anti-bacterial functions that include washing machine, clothe dryer, air purifier, air conditioner, and dishwasher. It, in some way, also propels the home appliance consumption to upgrade.

Normally, months after Spring Festival are considered the dull season of consumption. We believe that the outbreak will be effectively contained with regulatory measures of the government in place. Chinese home appliance industry will also actively adjust strategy to accommodate with changes. We believe that, enterprises will find opportunities in the risk, survive and thrive soon.

Home appliance industry actively shoulder social responsibility

The outbreak spreads faster than expected during Spring Festival. At this time, Chines home appliance players actively shoulder great social responsibility with goods delivered to affected areas since the early stage of the outbreak. As of now, medical institutions in key affected areas including the rapidly built Huoshenshan hospital and Leishenshan hospital have received home appliances and other goods from home appliance makers including Haier, Midea, Hisense, Galanz, TCL, Meling, BSH, A.O.Smith, Skyworth, Joyoung, Fotile, Robam, Vatti, Aux, Daikin, Whirlpool, Vanward, Lexy, Micoe, etc. Many of them have donated goods at a combined value of more than 100 million Yuan during the outbreak. We believe that, the value and strength of Chinese home appliance industry will again impress a lot of people, as the donated refrigerators, washing machines, disinfection cabinets, air purifiers, water purifiers, water heaters and microwave ovens arrive the medical institutions at fast speed.