China increases power cuts, 'scared' suppliers look to leave country

Posted:
in General Discussion
Regular power outages decided on by the Chinese government to save electricity, now look permanent -- and technology manufacturers say they are being scared into moving to different countries.

Tim Cook visiting China production
Tim Cook visiting China production


Since June, China's government has been forcing companies to shut down at times to save electricity. Now firms say they get weekly notifications of which days they will have no power, and fears that this is permanent are reviving aims to move away.

According to Nikkei Asia, the situation is being exacerbated because there is no clear pattern to which companies are being affected.

"It is very chaotic and confusing," an unnamed executive at an Apple supplier told the publication. "Some suppliers managed to secure power supplies based on their friendly relations and negotiations with the local governments, while some were affected badly."

Companies spared reportedly include iPhone assembler Luxshare, according to unspecified sources. Some other Apple suppliers believe that there is a logic to how the local government is determining who gets power, and who loses it.

"If you don't bring as much value as, say, displays or high-end semiconductors but consume a lot of energy, sorry you are out!" said an executive in a company that provides Apple with printed circuit boards. "It's better that you just shut down and move away."

The concerns over power supplies come as firms in the region say they are now also worried about operating in China.

"It's not just about power issues," said an unnamed iPhone supplier. "From [the disappearance of] Jack Ma to the crackdowns on gaming and education ... these all suggest increasing uncertainty for enterprises operating in China. People are scared."

Jack Ma runs Alibaba, a firm whose technology products in cloud computing reach almost 800 million users. Always outspoken, he criticized the Chinese banking system in a speech in November 2020 -- and was then not seen again in public for about three months.

These concerns, and a presumption that power outages will continue, is reportedly prompting companies to reconsider their Chinese operations.

"We heard that the situation could last till the end of this year or even longer," an executive from a speaker supplier told Nikkei Asia. It's not known if the unnamed executive's company supplies Apple, but it does sell to Amazon, Lenovo and others.

"Such inconvenience could be gradually unbearable," the executive said. "Now we are again reopening our evaluations of overseas plants, perhaps in Vietnam, Batam in Indonesia, or Thailand."

Apple and other technology firms have long been either considering or implementing plans to move production away from China. It's chiefly been because of fears of over-reliance on one source, but there have also been issues over US/China trade tensions.

Read on AppleInsider
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Comments

  • Reply 1 of 92
    22july201322july2013 Posts: 2,595member
    "It is very chaotic and confusing," an unnamed executive at an Apple supplier told the publication. "Some suppliers managed to secure power supplies based on their friendly relations and negotiations with the local governments, while some were affected badly."
    Companies spared reportedly include iPhone assembler Luxshare, according to unspecified sources. 
    Corruption. From which Apple benefits.

    By the way, has anyone noticed how the above photo looks photoshopped around the girl's teeth and lips? Can anyone analyze the pixels? If you look at her chin, there is a blur between her chin and Cook's shirt, but there is no such blur between her lips/teeth and the same shirt. What kind of camera can do that?
    edited October 8 elijahgbyronl
  • Reply 2 of 92
    MarvinMarvin Posts: 14,580moderator
    By the way, has anyone noticed how the above photo looks photoshopped around the girl's teeth and lips? Can anyone analyze the pixels? If you look at her chin, there is a blur between her chin and Cook's shirt, but there is no such blur between her lips/teeth and the same shirt. What kind of camera can do that?
    It's not the camera, this is just from post-processing effects, increasing brightness/contrast too much is creating some hard edges. Here's a different version:



    If you thought they had photoshopped a smile onto her otherwise miserable face due to Apple's wretched working conditions while Tim Cook maniacally laughs at her, you need to bone up on your detective skills MacGyver.
    davmknelsonStrangeDaysronnmagman1979fastasleepfoadbyronljony0
  • Reply 3 of 92
    This is a classic example of the failures of communism, big government and central planning. They can’t keep the lights on! The article, which in many ways from a journalistic perspective, isn’t written well - doesn’t answer the basic question of why there is a power shortage in China. It also speaks to the corruption of big government. Companies with political influence, and by inference, the resources to bribe officials, are the ones who get electricity (sounds a bit like what’s going on in Washington D.C.) You can be sure if companies are being denied electricity, private citizens are going without power in their homes. Do global warming alarmists really think China is going to limit CO2 output when they are bringing new coal burning power plants online every week, yet still can’t meet power demand? Apple should have been undertaking a serious effort to leave China a long time ago. But the lure of cheap labor and easier profitability has kept them there longer than they should have been. So wake up America! The siren’s lure of big brother government being the provider of the basic necessities of daily life touted by the likes of AOC, Bernie, Biden, Nancy and Schumer are deceptive and false. California, which is already a semi-socialist state, is well on its way to being unable to meet everyday power needs during periods of peak demand. Gavin Newsome and his ilk in Sacramento falsely think they posses the intellectual superiority to control the basic economic, environmental and societal variables of California to lead to optimal outcomes for the citizens of California. Given the outflow of people and companies from California I would argue they are failing. Tesla is moving their headquarters to Texas as a very recent example of this. Not to mention the California problems with homelessness. Apple’s next big worry is TSMC and their reliance on Taiwan for Apple CPU’s. If Apple were smart they’d be knocking on the doors of Intel and other domestic chip producers and start developing backup supply chains for chips. This is a multi-year effort so get started now! The China pendulum has reached its apex. Time for new plans Apple!
    lkruppcat52elijahgbyronlanonconformist
  • Reply 4 of 92
    DAalsethDAalseth Posts: 1,771member
    On the business report on CBC Vancouver a couple of days ago the reporter was asked about these power outages. He said that yes it was due to higher coal prices but the reason coal was more expensive was the interesting part. World coal prices are low, but China got a huge portion of its coal from Australia. China is annoyed with Australia and has stopped buying their coal. But there isn’t enough surplus coal or natural gas on the world market to make up the difference. At root this isn’t a structural problem, or due trying to move to a low carbon economy, something that has been blamed in some reports. At root it’s the Chinese government, meaning Xi, has gotten their nose out of joint at Australia, and the people are paying for it.
    tmayrcfablastdoorentropysronnmagman1979iqatedoelijahgp-doganonconformist
  • Reply 5 of 92
    lkrupplkrupp Posts: 9,557member
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    rcfacat52
  • Reply 6 of 92
    22july201322july2013 Posts: 2,595member
    Marvin said:
    By the way, has anyone noticed how the above photo looks photoshopped around the girl's teeth and lips? Can anyone analyze the pixels? If you look at her chin, there is a blur between her chin and Cook's shirt, but there is no such blur between her lips/teeth and the same shirt. What kind of camera can do that?
    It's not the camera, this is just from post-processing effects, increasing brightness/contrast too much is creating some hard edges. Here's a different version:



    If you thought they had photoshopped a smile onto her otherwise miserable face due to Apple's wretched working conditions while Tim Cook maniacally laughs at her, you need to bone up on your detective skills MacGyver.
    You taught me something. Thanks. And you made me laugh. Not many people can do both of those things.
    byronl
  • Reply 7 of 92
    DAalsethDAalseth Posts: 1,771member
    lkrupp said:
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    No. 
    Thats a completely clueless comment. 
    beowulfschmidtmknelsonblastdoorcharlesatlasronnmagman1979prairiewalkerfoadWgkruegerelijahg
  • Reply 8 of 92
    glennhglennh Posts: 54member
    tedz98 said:
    This is a classic example of the failures of communism, big government and central planning. They can’t keep the lights on! The article, which in many ways from a journalistic perspective, isn’t written well - doesn’t answer the basic question of why there is a power shortage in China. It also speaks to the corruption of big government. Companies with political influence, and by inference, the resources to bribe officials, are the ones who get electricity (sounds a bit like what’s going on in Washington D.C.) You can be sure if companies are being denied electricity, private citizens are going without power in their homes. Do global warming alarmists really think China is going to limit CO2 output when they are bringing new coal burning power plants online every week, yet still can’t meet power demand? Apple should have been undertaking a serious effort to leave China a long time ago. But the lure of cheap labor and easier profitability has kept them there longer than they should have been. So wake up America! The siren’s lure of big brother government being the provider of the basic necessities of daily life touted by the likes of AOC, Bernie, Biden, Nancy and Schumer are deceptive and false. California, which is already a semi-socialist state, is well on its way to being unable to meet everyday power needs during periods of peak demand. Gavin Newsome and his ilk in Sacramento falsely think they posses the intellectual superiority to control the basic economic, environmental and societal variables of California to lead to optimal outcomes for the citizens of California. Given the outflow of people and companies from California I would argue they are failing. Tesla is moving their headquarters to Texas as a very recent example of this. Not to mention the California problems with homelessness. Apple’s next big worry is TSMC and their reliance on Taiwan for Apple CPU’s. If Apple were smart they’d be knocking on the doors of Intel and other domestic chip producers and start developing backup supply chains for chips. This is a multi-year effort so get started now! The China pendulum has reached its apex. Time for new plans Apple!
    You need to turn off the FAUX (FOX) news channels and leave your house, city, state and country to brighten your perspective of the real world. I guess California is doing so bad that it’s economy keep growing and it State’s coffers are overflowing with cash despite the pandemic and without the help of federal (aka Blue States’) money. 

    Elon Musk is moving his HQ to Texistan!  However, his manufacturing and engineers are staying here in Cali! 

    As far as the issues in China, it was just a matter of time before the house of cards started to fall apart taking the capitalists who sold the CPC the rope to hang themselves and the CPC! It looks like the old Soviet were right after all…..🤪
    StrangeDaysronnmagman1979iqatedop-dog
  • Reply 9 of 92
    rcfarcfa Posts: 1,113member
    lkrupp said:
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    Nuclear power would solve the problem once and for all; it’s by far the greenest energy, if everything is factored in (land and resource use, waste, CO2, impact on eco systems, cradle to grave) and there’s enough of it for hundreds of millions of years.
    GeorgeBMacflyingdpentropysjcs2305magman1979elijahgFileMakerFellerjony0
  • Reply 10 of 92
    GeorgeBMacGeorgeBMac Posts: 10,490member
    tedz98 said:
    This is a classic example of the failures of communism, big government and central planning. They can’t keep the lights on!...
    LOL...  The UK can't keep the lights on either.  And we can't unload ships.

    Should China call that a failure of Capitalism?

    BTW, China just ordered increased output from their mines to alleviate the shortage.
    But, they have also been cutting back on the use and mining of coal because of climate change.  Plus, they stopped the import of Australian coal when they became openly hostile.   So, we'll have to see how they decide to manage that.   But one thing is certain:   The predictions of China's demise are greatly premature.
    edited October 8
  • Reply 11 of 92
    GeorgeBMacGeorgeBMac Posts: 10,490member
    rcfa said:
    lkrupp said:
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    Nuclear power would solve the problem once and for all; it’s by far the greenest energy, if everything is factored in (land and resource use, waste, CO2, impact on eco systems, cradle to grave) and there’s enough of it for hundreds of millions of years.

    I agree!
    Unfortunately it has been plagued by human stupidity.
    The Chernobyl disaster was caused by human error.
    The Fukishima disaster was caused by incredible stupid planning and design:   They built the plant on the edge of a sea known for tsunami's, built a protective sea wall that was far too small.  Then they put the control rooms in the basement next to that ocean so, when the tsunami struck, the control rooms were flooded and completely unusable (except with scruba gear!).

    The question is not whether nuclear is safe and clean but can we end this cycle of short sighted stupidity and build a plant correctly?   Well, obviously we can.  So perhaps the question is:  do we have the will to do so?
    byronljony0
  • Reply 12 of 92
    I don't envy the Chinese leadership. Hard choices are being made trying to move  1 1/2  Billion people (5x the U.S.) from a 19th century agrarian society into the 21st century. Coal has to go. A hard choice but the poisoned air of northeast china is causing serious political challenges for the CCP. Just like the U.S. in the 1970's-1980's, China has decided to focus on "clean"and profitable industries that enhance the environment, while discouraging "dirty" low profit industries. If steel mills have to move so be it, a more efficient software industry or robotics plant can take it's place.
    tokyojimu
  • Reply 13 of 92
    tmaytmay Posts: 5,455member

    https://syncretica.substack.com/p/rectification-campaign-to-energy


    Rectification Campaign to Energy Crunch

    How Chinese politics is leading to a chilly winter in Europe


    Energy markets are a hot topic now with gas prices going vertical in Europe and coal prices breaking all time highs. There have been numerous hypotheses lodged online blaming some very plausible causes including reduced gas storage and nuclear and some where the causal link appears to be missing, like renewables. Renewables are variable, but without them Europe would undoubtedly need more gas and be in more strife. 

    Over the last year I’ve been working on a project with ANU on China’s coal markets and logistics and how domestic drivers lead to massive changes in imports. This focus has perhaps given me a different lens to look through recent energy market developments that I will briefly present here. 

    China’s energy markets and global markets, especially for LNG and pipeline gas have become increasingly integrated over the last five years.

    ...

    By mid to late 2020, coal was looking to be in serious trouble. Chinese inventories were high and shipping data showed that much of the supply of coal to southern China was now coming from Northern China ports squeezing leaving little room for thermal coal imports and not just from Australia which was singled out for special treatment. Then something strange happened.

    From early 2021 China started to draw its coal inventories down hard and deliveries from Northern Ports to Southern ports started to drop (red arrow above). This might not be a big deal, but China’s power demand was flying at the time with electricity consumption up ~14% yoy in April-June and steel output up 21%. Coal stocks started to decline rapidly as can be seen below.
    So demand was very strong but supply fell behind sharply both for domestic production and imports. China’s coal production is heavily concentrated in a few provinces as you can see below:
    Over this period Inner Mongolia and Shaanxi output was poor - especially in the context of surging electricity consumption driven by industrial output of metals. 
    Imports were also weak from two major suppliers: Australia for political reasons, and Mongolia ostensibly for COVID reasons. 

    There is however another possible reason. During this period there was something of an anticorruption crackdown in Inner Mongolia which borders Mongolia. Decisions on mine approvals and the like are invariably contentious, especially during a period where the government is talking about greening the economy and commodity imports are often a source of graft. This article in Guancha may provide the answer.


    You can run that via google translate, but circa March of this year Xi was making explicit reference to anticorruption measures around the coal sector in Inner Mongolia. The collapse in imports and production over this period likely led to a shortage of approximately 30MT attributable to lost production and another 12MT from Mongolian imports. If you look at global seaborne coal imports, that is about two months of global imports, including China. 

    In gas equivalent terms, we know China takes about 330kg of coal per MWh of power, and a Combined Cycle Gas Turbine uses around 7GJ of gas per MWh. All in you are looking at bump in LNG demand to fill this hole equal to 5% of *annual* gas demand in Europe per IEA data.

    What can or should we take away from this? 

    anonconformistFileMakerFellerjony0
  • Reply 14 of 92
    DAalsethDAalseth Posts: 1,771member
    tmay said:
    The cost of fossil fuels is not just emissions but also in exposure to this volatility
    That is the most profound part. We shouldn’t be dependant on what China does, or what Iran does, or what Russia does. With a domestic, renewable energy supply we could, as my folks said back IN THE 1970s, tell them to drink their damn oil. Same goes for natural gas, or coal. Move off of them and it won’t just be good for the planet, it will be good for national security.
    tmaythtronnmagman1979p-dogtokyojimujony0
  • Reply 15 of 92
    tmaytmay Posts: 5,455member
    I don't envy the Chinese leadership. Hard choices are being made trying to move  1 1/2  Billion people (5x the U.S.) from a 19th century agrarian society into the 21st century. Coal has to go. A hard choice but the poisoned air of northeast china is causing serious political challenges for the CCP. Just like the U.S. in the 1970's-1980's, China has decided to focus on "clean"and profitable industries that enhance the environment, while discouraging "dirty" low profit industries. If steel mills have to move so be it, a more efficient software industry or robotics plant can take it's place.
    It's quite true that PRC needs to improve its productivity, especially since the population is aged and a proportionally smaller workforce is supporting the economy than 50 years ago when they joined the global economy. The PRC is also attempting population increases, allowing two, or possibly more births for the Majority Han population; Minorities not so much. There are predictions that the PRC economy will peak without "getting rich", and it is likely that they will see severe population declines.

    Steel production is likely the largest component of industrial energy use, and as a major component of China's economy is driven by infrastructure growth, it is unlikely to be reduced by much.

    China shot itself in the foot by "boycotting" Australian coal, a result of broken diplomacy between the two. I would put this blunder squarely on Xi Xinping.
    edited October 8 p-doganonconformistFileMakerFeller
  • Reply 16 of 92
    StrangeDaysStrangeDays Posts: 11,689member
    lkrupp said:
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    The gerbils spinning in your head are getting hungry again.
    tmayronnmagman1979prairiewalkerfastasleepp-dogjony0
  • Reply 17 of 92
    StrangeDaysStrangeDays Posts: 11,689member
    tedz98 said:
    This is a classic example of the failures of communism, big government and central planning. They can’t keep the lights on! The article, which in many ways from a journalistic perspective, isn’t written well - doesn’t answer the basic question of why there is a power shortage in China. It also speaks to the corruption of big government. Companies with political influence, and by inference, the resources to bribe officials, are the ones who get electricity (sounds a bit like what’s going on in Washington D.C.) You can be sure if companies are being denied electricity, private citizens are going without power in their homes. Do global warming alarmists really think China is going to limit CO2 output when they are bringing new coal burning power plants online every week, yet still can’t meet power demand? Apple should have been undertaking a serious effort to leave China a long time ago. But the lure of cheap labor and easier profitability has kept them there longer than they should have been. So wake up America! The siren’s lure of big brother government being the provider of the basic necessities of daily life touted by the likes of AOC, Bernie, Biden, Nancy and Schumer are deceptive and false. California, which is already a semi-socialist state, is well on its way to being unable to meet everyday power needs during periods of peak demand. Gavin Newsome and his ilk in Sacramento falsely think they posses the intellectual superiority to control the basic economic, environmental and societal variables of California to lead to optimal outcomes for the citizens of California. Given the outflow of people and companies from California I would argue they are failing. Tesla is moving their headquarters to Texas as a very recent example of this. Not to mention the California problems with homelessness. Apple’s next big worry is TSMC and their reliance on Taiwan for Apple CPU’s. If Apple were smart they’d be knocking on the doors of Intel and other domestic chip producers and start developing backup supply chains for chips. This is a multi-year effort so get started now! The China pendulum has reached its apex. Time for new plans Apple!
    Oh, did you mean California - the 5th or 6th largest economy in the world? Yeah they're doing fine. Just because anti-labor and anti-COVID-measures wingnuts like Musk chase corporate welfare elsewhere doesn't mean there is anything wrong w/ CA. 

    Also, you've enjoyed the fruits of socialism since before you were born.


    GeorgeBMactmaymuthuk_vanalingamronnmagman1979fastasleepiqatedoJaiOh81Wgkruegerp-dog
  • Reply 18 of 92
    StrangeDaysStrangeDays Posts: 11,689member
    rcfa said:
    lkrupp said:
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    Nuclear power would solve the problem once and for all; it’s by far the greenest energy, if everything is factored in (land and resource use, waste, CO2, impact on eco systems, cradle to grave) and there’s enough of it for hundreds of millions of years.
    If you ignore the leaks of radioactive material (material that outlives our society), and the major plant failures already experienced in the past decades. Yeah, perfect.
    rcfa said:
    lkrupp said:
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    Nuclear power would solve the problem once and for all; it’s by far the greenest energy, if everything is factored in (land and resource use, waste, CO2, impact on eco systems, cradle to grave) and there’s enough of it for hundreds of millions of years.

    I agree!
    Unfortunately it has been plagued by human stupidity.
    The Chernobyl disaster was caused by human error.
    The Fukishima disaster was caused by incredible stupid planning and design:   They built the plant on the edge of a sea known for tsunami's, built a protective sea wall that was far too small.  Then they put the control rooms in the basement next to that ocean so, when the tsunami struck, the control rooms were flooded and completely unusable (except with scruba gear!).

    The question is not whether nuclear is safe and clean but can we end this cycle of short sighted stupidity and build a plant correctly?   Well, obviously we can.  So perhaps the question is:  do we have the will to do so?
    Better question - what makes you think we can separate human error from humanity? Lots of things would be ideal if human error wasn't a factor. But that's not the world we live in. IRL, human error is a factor.
    edited October 8 muthuk_vanalingamronnfastasleepAppleZulup-dog
  • Reply 19 of 92
    blastdoorblastdoor Posts: 2,456member
    DAalseth said:
    lkrupp said:
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    No. 
    Thats a completely clueless comment. 
    QFT. Also, I’ve seen similar stories re Australia. 

    China might turn out to be much more fragile than they appear. I sure hope so anyway.

    If this were a game of Civ, I’d say everyone is in a dark age at once. 
  • Reply 20 of 92
    GeorgeBMacGeorgeBMac Posts: 10,490member
    rcfa said:
    lkrupp said:
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    Nuclear power would solve the problem once and for all; it’s by far the greenest energy, if everything is factored in (land and resource use, waste, CO2, impact on eco systems, cradle to grave) and there’s enough of it for hundreds of millions of years.
    If you ignore the leaks of radioactive material (material that outlives our society), and the major plant failures already experienced in the past decades. Yeah, perfect.
    rcfa said:
    lkrupp said:
    And if the climate change radicals get their way this is the future for the U.S. Learn to live one or two days a week without power... to save the planet of course.
    Nuclear power would solve the problem once and for all; it’s by far the greenest energy, if everything is factored in (land and resource use, waste, CO2, impact on eco systems, cradle to grave) and there’s enough of it for hundreds of millions of years.

    I agree!
    Unfortunately it has been plagued by human stupidity.
    The Chernobyl disaster was caused by human error.
    The Fukishima disaster was caused by incredible stupid planning and design:   They built the plant on the edge of a sea known for tsunami's, built a protective sea wall that was far too small.  Then they put the control rooms in the basement next to that ocean so, when the tsunami struck, the control rooms were flooded and completely unusable (except with scruba gear!).

    The question is not whether nuclear is safe and clean but can we end this cycle of short sighted stupidity and build a plant correctly?   Well, obviously we can.  So perhaps the question is:  do we have the will to do so?
    Better question - what makes you think we can separate human error from humanity? Lots of things would be ideal if human error wasn't a factor. But that's not the world we live in. IRL, human error is a factor.

    Call me an optimist.
    The line that stands out for me from "Apollo 13" is not "Houston, we have a problem" but:  
    "Failure is not an option".

    As a project manager I always tried to avoid any situation that could create a catastrophic failure.  But, when the possibility could not be eliminated I double, triple, and quadruple checked every detail and every possible variation to insure that it didn't happen.

    Unfortunately, our western energy programs are run by for-profit companies who try to balance profit and safety.   When "Failure is not an option" there cannot be a balancing act.
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