3M struggles with demand for its protective masks
— 3M cannot make protective respiratory masks fast enough as the coronavirus continues to spread.
The Minnesota-based company continues to ramp up production of the masks at plants in China but also other countries in Asia, Europe and Latin America, as well as the United States.
Even so, global demand is still “exceeding supply,” said 3M spokeswoman Jennifer Ehrlich in an e-mail. “3M expects demand for respirators to outpace supply for the foreseeable future.”
St. Paul-based Ecolab, which provides sanitizing and disinfect- ing chemicals, said it is selling more disinfectants in China. But even as hand sanitizing and disinfectant sales rise there, demand for other products is falling, investor relations head Mike Monahan said last week.
The coronavirus effects will likely decrease Ecolab’s earnings this year by 10%, even as the higher disinfectant sales in China and perhaps other countries affected by the virus will increase.
Many hotels, restaurants, airlines and cruise ships in China, South Korea, Italy and elsewhere are losing revenue as locals stay home for fear of getting sick.
U.S. manufacturers are bracing to see just how hard the coronavirus will slam business this year as they cope with supply delays, partly staffed factories and thousands of office workers sequestered to working from home.
Minnesota producers with suppliers or factories across China have banned employee travel, set up morale-boosting phone calls to homebound workers, launched factory washdowns and changed supply schedules and routes. All in the hopes of coping with an outbreak that originated in China in December but has since fanned out worldwide, claiming nearly 3,000 lives and sickening more than 80,000.
The situation has U.S. producers on edge and stuck in “waitand-see” mode.
“The coronavirus is rapidly slowing the momentum of the global economy and sucking the oxygen out of financial markets,” noted Bank of the West economist Scott Anderson in an e-mail Tuesday.
“A brief period of global economic and financial market optimism (that had occurred) over the past four months is quickly going dormant as the global economic impact of the novel coronavirus (COVID-19) comes into greater focus,” he said. “China’s growth rebound is not expected to be realized in 2020.”
China is operating at about 50% to 60% capacity, but auto sales and travel in China are down about 90% from a year ago.
“The impacts are just now starting to be felt on global supply chains beyond China’s borders and we think U.S. companies could see more negative fallout in the second quarter than they acknowledge in the first,” Anderson wrote.
3M is closely monitoring and responding to any potential impact to “its broader supply chain,” Ehrlich said, but did not elaborate on where delays are occurring or for which products.
3M generally manufactures goods in China for the Chinese market and not for export from that country, she said. “The majority of our products made in China are sold in China. 3M’s manufacturing model is local for local.”