This holiday season, the next PlayStation and Xbox consoles are scheduled to arrive.
But the PlayStation 5 and the Xbox Series X, just like much of the world’s consumer electronics, are being manufactured in China. And China is currently the focal point of the Wuhan coronavirus outbreak.
Of the more than 560 people who have died from the virus, all but two fatalities have been in mainland China. Over 28,000 people were reported as infected as of Wednesday.
China’s manufacturing sector, which is responsible for producing the vast majority of the world’s consumer electronics, has been hit particularly hard. Foxconn, the manufacturing giant that produces the iPhone, is quarantining workers. At least one supply chain executive told Nikkei Asian Review that, “The [coronavirus] situation in China could affect the planned production schedule” of the next iPhone.
Similarly, as Microsoft and Sony ramp up production of their next-gen consoles, those launches could see delays or, at least, constrained launch supply due to the coronavirus outbreak.
“The video game sector is currently manufacturing, or beginning to, a once-in-several-years’ product generation change for the 2020 holiday season,” a note from Jefferies Group published this week says. “If [company] shutdowns exceed a month or so, game schedules will be delayed. New consoles may likewise suffer supply issues from a prolonged disruption, ahead of their Fall 2020 planned launches.”
Put more simply: Next-gen consoles, and the games being produced for those consoles, may get hit with delays due to the coronavirus outbreak.
Though most major video games are made in North America, Europe, and Japan, large components of those games are outsourced to China. As much as “30-50% of art creation in western games is done in China,” according to the note. In terms of the hardware itself, nearly 100% of the manufacturing takes place in China.
Notably, Nintendo has outright announced production delays due to the coronavirus outbreak — shipments of the Nintendo Switch console are delayed to Japan, the company announced this week. Both Sony and Microsoft didn’t respond to request for comment on potential next-gen console delays due to the virus outbreak.