China COVID-19 Lockdowns Likely to Delay Amazon, Walmart Online Orders

Amazon and Walmart customers are likely to face delays due to COVID restrictions in some of China’s major manufacturing hubs, according to an industry trade group, Bloomberg reported Tuesday (March 15).

The location of half of China’s online retail exporters in Shenzhen was recently placed in a lockdown to contain the spread of COVID. In Dongguan, a center for shoe, textile and toy manufacturing, factories that reported COVID cases were told to close.

More than 17 million residents were instructed to telecommute, and non-essential businesses and public transportation were shuttered.

“Shenzhen now has pressed the pause key, with operations halted for almost all sectors, and we are no exception,” said Wang Xin, president of the Shenzhen Cross-Border E-Commerce Association, whose organization represents 3,000 exporters in China’s tech hub.

He said these moves have created a “significant disruption to the production and delivery of goods sold on major online marketplaces,” and the association is negotiating with the Shenzhen government officials to resume some parcel deliveries.

China’s international eCommerce sector broke the $6 trillion mark for the first-time last year, according to China’s General Administration of Customs. The increase in foreign trade in 2021 reached $1.4 trillion.

Seko Logistics, an Illinois-based supply chain solutions company, issued a warning regarding the delays on Monday (March 14). It read, “As the outbreak of Omicron across China worsens, local authorities are enforcing restrictions which will have an impact on our offices, warehouses and operations.”

See also: China’s Lockdowns to Have a Negative Ripple Effect on Last Mile

The company said none of its agent warehouses in Shenzhen and Dongguan are operational and acknowledged a labor crunch. Still, some drivers are available due to COVID-19 testing policies, and airports remain open, though flight cancellations may be coming soon.