How are things in Asia? Europe?

 

 

I really do not have a good way to ask someone in Asia or Europe how things are going in their fastener workplaces. Sure, a lot of people I work with are in contact with factories and get some feedback on deliveries, etc. but I would welcome some responses from anyone out there that would like to share a little bit on how their work atmosphere has changed and how they are adapting.

Marty, I posted this yesterday to my personal contacts but thought I would share it here for you if it helps:

It’s really important for me to share this with you all. For those of you who only think of me as running my dad’s “deer repellent” business, this might come out of left field. Over the past few years, I have done a bunch of international travel to both sell and source product. These trips have taken me to the Middle East, Europe and Asia. I’ve made great friends, trusted allies and seen things first hand that many of you only have an imagined picture of in your head. With all of the covid news going around I’ve made it a point to speak to my contacts throughout mainland China and Korea to see what is happening first hand, outside of the media reports and without a single adjective added. This is just their words, and I hope they provide some perspective.
January 28th, from my contact in Hangzhou “We are good, and the holiday is not bad, but people in Wuhan City are under serious condition, everyday we pray for them, believe everything will become fine”
February 14th from my college friend in mainland china (location unknown, but had been working in Beijing) “it’s pretty bad but we are totally fine, thanks for asking. My fiancée and I are holed up in the countryside. We will be fine. But yeah, it’s nuts. Really next level, never seen anything even remotely like this. The entire country has ground to a halt. Anyway we are taking precautions, all good and thanks for checking in on us. Hope all is well!”
February 24th from a new supplier that was shut down and could not communicate for 2 weeks “We have back to work , if you need any inquiry please asking me for free. Thank you .”
March 3rd from my customer in Seoul Korea “Thank you for your concern.
The Korean team has no harm at all.
I hope your company is safe, too.
Thank you always. ”
March 11th, from my supplier in Henan “Thanks for your concern,I am very health, and ok, now, China control is very well, so you could assure.”
Today, March 18th from my Korean customer, “Korea is becoming safer and safer.
I know the situation in America through the news.
I wish all your family and company employees safe.”
In the past 60 days, suppliers were shut down and unable to communicate, but now they are at full production, ready to export with no delay. Customers who put pauses on emails, resurfaced and requested information. I also know how, if you want, you can add color to these notes and say “their country is telling them to say everything is ok” or “they’re lying” but these are real people who have, in every sense of the word, been reliable and trustworthy for years. These are people I have personally met with , broken bread with and laughed with
I understand how uneasy it feels right now. I know that everyone wants answers. I know we want to know when things will be back to normal, and I am not here to tell you when that will be, but maybe knowing someone who has been in direct communication with people who are coming out of the other side of this will help you to be a little more optimistic. We’re not out of it. But we will be. How we treat each other on this journey is all that matters right now.
Life finds a way…

 

Mostly business as usual.

Europe is still good, except for Italy and that’s because FedEx, UPS and some freight lines aren’t picking up in some regions of Italy, so while their manufacturing plants might be open, they can’t actually get the material out the door unless you call for one of the few freight lines still running in that area. This could cause problems for smaller orders that don’t really meet weight for such freight.

Otherwise, Germany, Italy, Switzerland, UK, etc. are all still functioning and the internal logistics are fine, but due to International Travel Bans, passenger planes aren’t moving, therefore it’s a bit more expensive than usual to move stuff via air freight, because the only planes that are moving (to my knowledge) are the FedEx and UPS planes. At Eurolink, we’ve decided to just eat that difference in cost so we can stay consistent for our customers.

Italian logistics being down probably only affects <5% of our business, so the vast majority of our customers shouldn’t see any difference in service.

I’m more concerned with our own country at this point due to Honda, Chrysler, GM, Fiat, etc. all shuttering their plants… hoping (unless absolutely necessary to save lives) that doesn’t cause a domino affect causing other stateside OEMs to shut down.

 

Daniel Rivalin says:

Europe industry is closing altogether (maybe not in UK yet).

All car makers have closed plants in France, Italy, Spain – Friday in Germany on the latest : Renault, PSA, VW, running out of parts AND/OR since they cannot sell (for car makers, all selling points are closed), they do not want to make useless inventories.

But also in aerospace Airbus, Bombardier have closed plants already.

Tier 1/OEM are following by a few days, already closed or reducing drastically their production.

Agrati has officially shut down yesterday their factories in Italy and France.

Most of the small factories in Northern Italy will have closed pretty soon when they will run out of wire, or service companies.

Transportation is every day more of an issue.

So the whole supply chain is mostly collapsing within this week in Europe.

In construction and electric industries, I can talk for France, hundreds/thousands of companies have already closed their doors on Tuesday when confinment has been requested. How to work with your colleagues on a building when you shall keep 1 meter away of each other…?

Taiwan is doing much better than us on the contrary. They have Covid-19 pretty well under control so far and keep working.
My company is China has resumed work 3 weeks ago, slowly but surely.

But they all will suffer postponing or cancellation of orders in the coming days when automatic 3 and 6 months forecasts will be sent out by ERP this week-end and reflect new needs.

This is current situation my friend.

This is going to be tough in cash for companies as for countries to avoid bankruptcy….

Daniel

 

Marty, these are interesting time indeed! I hope that you and your family are staying as healthy as possible considering all we are faced with!
I have limited dealings in Europe so my viewpoint is from discussions I’ve had with my industry manufacturing friends in Taiwan and China whom I trust to provide me with a good well-rounded information and perspective.
Taiwan is currently very safe as the Government took quick precaution to the virus; they now are awaiting a second wave and can only hope they are equally prepared this time! The Taiwanese government has been aggressive in testing their citizens and the result has been about 100 cases and under 10 deaths to my understanding. Phenomenal! The Taiwan CDC has held daily reporter conferences to communicate to their citizens how many cases they have and how they anticipate the infection happening.
It was noted to me that Taiwan has limited all foreign visitors at this time. I’m unsure how long this is to last.
Also, as of today Taiwan CDC started testing a vaccine in step with the USA CDC, encouraging news for sure!
Business in Taiwan has slowed much like it was pre-Chines New Year. To date no Fastener factories have been shut down due to the virus.
Economies in USA and EU seem to be flat. Anticipation is that the EU will be the first to ramp up on purchases likely midway into Q2, or slightly sooner, as in-house inventories are low throughout the EU. They will be the first to take advantage of some declining pricing from the factories in Taiwan (and China) thirsty for business.
Taiwan view of Mainland China is that they must be getting back to production as the smog is starting to roll in from Southern China….
I have heard much of the same out of China. Any foreign visitor will be expected to wait in a 14-day quarantined area upon entry to the country. Depending on Nationality it will be a Government quarantine or a self-quarantine situation, this I thought was interesting. Obviously, most attention will be put on those heavily infected countries.
China’s labor force is approaching 80-90% depending on the size and location of the factory. Some of the larger factories near Shanghai for example are on the lower % as they are still waiting for some of the workers from further inland to make it back to work. But that will increase here in the coming days and weeks.
I have been told their domestic trucking is approaching normal. So freight is able to move in country without delay. Also, things such as packing materials have no negative effect on day to day business. I had one close friend say that China is not ready for business but in need of it! So if anyone states labor is short, cannot route their cargo internally or waiting on packing materials best have that double checked because that is simply not the case!
This is a little of what I have learned and will keep in touch with my friends and suppliers in Asia and trust that we will all survive this trying time!

 

Marty, you already have some very good responses and they tell the story overseas. I take a little bit of a different approach. Remembering back in the early 70’s, when there was a shortage of nuts and flat washers and everybody was begging, borrowing and stealing to get any parts they could.

TODAY, the smart distributors will build their inventories with their “A” items and the basics. They will also adjust their inventories in regards to current contracts and the changing demands. When “THIS” turns around, the successful distributors will have inventory and be in great shape to take care of their customers and grow their market share from others that sat on their hands.

I believe this is a great time to evaluate and adjust your business and in the long run the fastener industry will be stronger then before with more lean & mean and better managed companies!

 

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