China’s energy crisis is impacting Elon Musk, as he tweeted “This is a serious concern “referring to the power shortages end of September. And the man behind Tesla who relies heavily on factories in China is not the only one concerned. Many industries and private households in China feel the impact of rising energy prices.
In 2017 Elon Musk fixed the energy crisis in the South of Australia with offering a 100-megawatt battery plant, and he succeeded in building this plant within 60 days! But he did not make a similar offer to solve the energy crisis in China, yet!
In the meantime, Citi bank reported they expect China’s coal and power supply crunch to persist into the winter.
The big question is, shall this energy crisis impact your supply of bags manufactured in China?
Measures taken to manage the Energy Crisis in China
The energy crisis is a top priority for the Chinese government, who now is facing with a soaring demand for energy as the global economy reopens. The energy transfer to reduce carbon emissions is adding to the stress because hundreds of coal mines were shut down or have reduced production earlier this year. Manufacturing hubs in the northeast of China have been hit particularly hard by these power shortages. The measures to mitigate the impact taken by the Chinese government are both on the supply and demand side.
The government in Beijing has ordered China’s coal mines to boost output to mitigate the energy shortage across the country, that has impacted millions of homes and businesses. Three major coal-producing provinces already have pledged to increase production, Chinese news agency Caixin said.
To mitigate demand, the power companies have requested the industrial zones to act; like to have factories to close, for a couple of days a week. These requests differ for every province and region. Every industrial zone has a unique plan, in line with the local energy shortage. During this time most factories keep their workers. When the factory must shut down their activities for a couple of days, the workers will get a leave.
Because the approach differs per region, production continues in areas where enough energy is available. But still, overall, the impact is stress on the supply chain.
How we deal with the impact on customized bags?
The energy crisis is a global phenomenon, with impact on availability and process. Like the COVID-19 crisis it is important to communicate about it and to work out an acceptable solution for all parties involved.
At JimboBags we communicate to our customers about the impact on the production lead times. While we keep on looking for alternatives, like sourcing from other locations and continues streamlining of our design process and production lines.