There is some concern among the Tame Apple Press that Apple will not be able to source key parts from South Korea if a war starts. Never mind the huge body count that is expected – just so long as Apple fanboys get their toys.
Trump told Reuters that a major conflict with North Korea is possible in the standoff over its nuclear and missile programmes, though he would prefer a diplomatic resolution. But then he might have changed his mind by the time he popped around the corridor.
South Korea, a US ally and home to major electronics parts makers such as Samsung Electronics, LG Display and SK Hynix, would be particularly vulnerable to any military attack from its northern neighbour.
South Korea supplies more than half of components such as memory chips and flat screens.
However, investors are pouring money into South Korea’s financial market, and companies are flocking to the stock market to raise billions of dollars.
Seoul’s stock market has climbed nine percent so far this year to near record highs, helped by strong earnings by major exporters including Samsung Electronics, which rose three percent to a life-time high on Friday after reporting its highest profit in more than three years.
Earlier this week, Hynix and LG Display, both Apple suppliers, reported record quarterly profits and sounded upbeat for the remainder of the year.
LG said that talk of conflict is speculative, and it did not have any plans to react to the current situation.
Hyundai Motor, the country’s top automaker, said it had detailed contingency plans to ensure business carried on under various situations but couldn’t disclose them.
Any military conflict on the Korean peninsula could have a dramatic effect on the memory chip market in particular, as Samsung’s and Hynix’s main operations are clustered in South Korea.
The pair control half of the flash memory market, and almost two thirds of DRAM chips, widely used in computers, making it almost impossible for customers to find alternative supplies quickly.
As supply of those chips are already tight, any interruptions to their manufacturing operations might cause large customers such as Apple and Lenovo to trigger a contractual term known as an “allocation” to get more of their suppliers’ limited supply, according to industry executives.
The ultimate beneficiaries of supply interruptions in South Korea would likely be Japan’s Toshiba, and US firms Micron Technology and Western Digital.