Video game industry suffers amid coronavirus woes
Recent data points to a trend that video game are shying away from China for the long-run, as demand and downstream supplier chains are rocked by the effects of the new coronavirus containment efforts, according to researcher examiner at Panjiva and S&P Global Market Intelligence, Chris Rogers.
“Due to the new coronavirus infection that is currently occurring, it is expected that production and shipment delays will be inevitable for peripheral devices such as the Nintendo Switch and Joy-Con manufactured in China for the Japanese domestic market,” said Japanese video game giant, Nintendo.
In 2019, US imports were already steadily falling in the video game sector, with a 28.4% drop from the previous year. Meanwhile, early 2020 data from Panjiva indicated that shipments associated with the Xbox system were down 51.8%. Both Sony and Nitondo have suffered comparative drops - 20.9% and 35.1%, respectively.
China accounted for 87.9% of seaborne imports for all video game platforms in 2019 and 97.6% in 2018, as per Panjiva research data.
Out of the three top video game brands, Microsoft's Xbox is the most dependent on Chinese parts and products, which accounted for 95.1% of shipments connected to the brand in 2019, closely followed by Nintendo’s goods with 90.1% of US seaborne shipments originating from the China’s mainland. Sony's PlayStation shows the smallest dependency, with 68.2% of shipments to the US that are connected to the brand ,originating from China.
As of February 11th, there are 43,103 confirmed cases of the new virus around the globe, with 1,018 reported fatalities.