Bloomberg has released a story regarding issues Nintendo may be having with acquiring parts for Nintendo Switch production. They cite a source “familiar with [Nintendo’s] operations” which indicates that COVID-19 lockdowns imposed by the governments of Malaysia and the Philippines are likely to limit production this year. A Nintendo spokesperson, however, declined to make an official comment.
While the final assembly of Switch hardware primarily takes place in China, they do not produce all of the components needed. The printed circuit boards (PCB) are largely produced in Malaysia and while they recently relaxed lockdown procedures internally, they have maintained sealed borders. The Philippines also contribute passive components (capacitors, resistors, etc.) which are embedded in the PCBs produced in Malaysia. The Philippines are still under local lockdown at present, but President Rodrigo Duarte is considering easing the manufacturing restrictions at the end of the week.
This report comes just a week after Nintendo released its financial report for 2020 and forecasts for 2021. While sales of Switch hardware were higher than expected for 2020, they did forecast lower sales numbers for Switch hardware in 2021. The reasoning for this decrease in sales projections was partially attributed to store closings preventing physical sales, but they did also mention that continued COVID-19 disruptions could affect product supply.
Considering the fact that they understand that COVID-19 may impact production and even stated as much in their financial forecasts, it is curious that a Nintendo spokesperson did not provide a comment to Bloomberg. It is possible that it is simply a case of Bloomberg having a deadline and Nintendo did not respond in time for the article. It may also be that Nintendo did not comment because they simply do not know enough at this time to make a comment, though you would have expected a diplomatic response saying as much. Regardless, we can expect the Switch hardware scarcity to continue well into the summer of 2020 as demand is still high for home entertainment right now.
