As the coronavirus pandemic continues, some factory operations in the supply chain have been suspended as their employees have been found to be infected by COVID-19. For example, last week, Japanese MLCC manufacturer Murata suspended its operations for seven days after one employee tested positive. Similar situations have arisen at TDK and Nichicon. Other manufacturers, such as Panasonic and Toshiba, are closed as a result of the state of emergency announced in Japan.
We expect shortages in the component market, particularly for MLCCs, for a period of time. We will notify our customers individually if we see their products affected, so that we can plan accordingly.
On the transportation side, since much of the air cargo capacity has been dedicated to medical devices and supplies from China to Europe and North America, it can take as long as 72 hours for our logistics partners to book spots for air shipment. Last week, FedEx cancelled Economy service in the Asia region, offering only Priority service. We expect to see increased air shipping costs as well as longer transit times as a result.
We will continue to communicate with you throughout this critical situation. Maintaining a reliable supply chain will always be our priority.