Beijing has locked down an area that includes Foxconn’s ‘iPhone City’ factory – its biggest iPhone assembly plant in China
Production of Apple iPhone devices could be impacted after Chinese authorities ordered a seven day lockdown of the area around Foxconn Technology Group’s main iPhone plant in Zhengzhou.
In response to Covid outbreaks, the lockdown starting Wednesday will reportedly severely curtail shipments in and out of the world’s largest iPhone factory.
The lockdown will last until 9 November, local government officials reportedly said in a statement posted to its WeChat account.
Chinese authorities have ordered people and vehicles off the streets except for medical or other essential reasons.
This restriction threatens to cut off the flow of additional workers and components needed to ramp up iPhone production ahead of the holiday-season rush.
CNN reported, citing social media videos, that anxious workers, have already fled the locked-down facility.
Silicon UK reported earlier this week that the Taiwanese company was racing to control a Covid outbreak at its campus in the central Chinese city of Zhengzhou, capital of central Henan province.
The Zhenzhou complex employs some 200,000 workers and is sometimes referred to as “iPhone City”.
At the weekend Foxconn said it would not stop workers from leaving.
Indeed, the company said it is arranging point-to-point transportation to ferry workers back to their home towns in other cities in central China.
“[We] fully understand your eagerness to go back home,” Foxconn told its employees over the weekend, according to CNN that cited a post on Zhengzhou government’s official WeChat account.
“For employees who voluntarily stay in the company’s factory area, the port government and the company will jointly ensure everyone’s…health and safety,” it added.
According to CNN, analysts have said the chaos at Zhengzhou could jeopardize Apple and Foxconn’s output in the coming weeks.
Ivan Lam, senior research analyst at Counterpoint, estimated that between 10 and 30 percent of iPhone 14 production could be affected in the near term if the situation did not stabilise.
The Zhengzhou campus is the world’s biggest iPhone factory and typically accounts for as much as 85 percent of iPhone assembly capacity, according to Lam’s estimates.
According to CNN, a Foxconn spokesperson told Chinese state media that the company is trying to boost production at other sites.
“At present, because now is the peak production season… [there is] a large demand for workers,” a Foxconn spokesperson told Henan Daily on Monday, adding that the company was “also coordinating back-up production capacity at other sites.”
Apple’s production has already been disrupted by China’s strict zero-Covid policies during the pandemic, which this year have resulted in a two-month lockdown in Shanghai and sporadic closures in other cities.
In September this year Apple announced that it had begun manufacturing some of its iPhone 14 handsets in India.
That move came as manufacturers explore alternative production sources away from China, amid its ongoing geopolitical tensions with Western nations, coupled with its strict pandemic restrictions that have disrupted supply chains for many industries.