Josh Horwitz

SHANGHAI, (Reuters) – China’s power crisis will force many European businesses to hold back orders. Some firms also have concerns about the way authorities inform them of power outages.

Klaus Zenkel, Vice President and Chair of South China at European Chamber of Commerce, told journalists at a press briefing that “many members believe they need to delay their order, their customers feel unhappy, so it affects them normal business and maybe some customers cancel their orders.”

Bernhard Weber (Vice-chair) of the European Chamber’s Nanjing Chapter, complained about the fact that local governments often notify factories of power outages.

Weber stated that companies are informed via SMS in the middle night by Weber about imminent power outages.

According to him, factories can only be issued a monthly power quota by authorities in Wuxi’s urban economic zone.

It is something that all other areas, and all other cities do on a daily basis. It is impossible to know if you will be able produce from one shift or another.

Zenkel stated that there were instances when companies could not get regular power and had to use their diesel generators.

Last month, China’s worsening power crisis caused production to stop at many factories. This was exacerbated by the shortage of coal.

Analysts and traders expect that the energy crisis, which gripped the second-largest economy and largest exporter in the world, will continue until the end. They forecast a 12 percent drop in industrial power consumption for the fourth quarter due to a fall in coal supplies.

Joerg Wouttke, the president of the chamber said the key tests for industry are Oct. 15 and November 15, when China’s central heating system will start servicing northerly residents.

If the power cut continues into Christmas, there may be even more price hikes and component shortages.

We are here for the marathon and not for the sprint.