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Coronavirus to stall Switch production in April onward, sources say

Nintendo's production facilities in Vietnam to be impacted by coronavirus, leading to Switch shipment delays to United States

Derek Strickland | Feb 17, 2020 at 10:49 am CST (1 min, 54 secs reading time)

According to key sources familiar with Nintendo's manufacturing plans, Switch supply could be stalled in overseas regions like the U.S. and Europe in the coming months.

Coronavirus to stall Switch production in April onward, sources say | TweakTown.com

Despite Nintendo's assertions the coronavirus won't interrupt Switch production, sources close to the supply chain tell Bloomberg console shipments in the United States and Europe may be affected in the coming months. Nintendo had recently announced the coronavirus has constrained Switch supplies in Japan.

The coronavirus outbreak is expected to interrupt the supply chain between Chinese manufacturing facilities and Nintendo's Vietnam branch, the latter of which supplies Switch shipments to North America and Europe. Internal sources now say Switch inventory could be affected as early as April, restricting stock to these critical regions. Nintendo pulls in most of its sales from the U.S. and Europe--the company made 77.8% of its total net revenues from overseas sales in Q3'19.

Nintendo's facility in Vietnam was established as a precautionary measure against now-cancelled tariffs, which threatened to raised import taxes on Switch console components.

The growing coronavirus threat is likewise affecting other manufacturers like Sony, whose lucrative camera sensors were impacted by the Wuhan virus. It's possible that next-gen PlayStation 5 and Xbox Series X console production could be hit as well and lead to a delay past 2020 for both systems.

This development could negatively hit Nintendo's FY2020 hardware sales forecast during a time where the company wants to dramatically accelerate Switch sales via aggressive software development.

Last updated: Apr 6, 2020 at 04:35 pm CDT

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NEWS SOURCE:bloomberg.com
Derek Strickland

ABOUT THE AUTHOR - Derek Strickland

Derek is absorbed with the intersection of technology and gaming, and is always looking forward to new advancements. With over six years in games journalism under his belt, Derek aims to further engage the gaming sector while taking a peek under the tech that powers it. He hopes to one day explore the stars in No Man's Sky with the magic of VR.

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