A Chinese iPhone plant is a significant concern for Apple




The world’s largest iPhone manufacturing in central China experienced a violent workers’ uprising this week, significantly disrupting Apple’s already constrained supplies and illuminating how the nation’s strict zero-Covid policy is harming international technology companies.

Workers fled the manufacturing campus in Zhengzhou, the capital of the central province of Henan, last month as a result of concerns from Covid, which marked the beginning of the problems. As a result of the staff shortage, bonuses were provided to employees.

However, this week there were protests because the freshly hired personnel felt the management had broken their word. The workers were eventually given money to quit and go after tussling with security guards wearing biohazard suits.


Analysts said the woes facing Taiwan contract manufacturing firm Foxconn, a top Apple supplier which owns the facility, will also speed up the pace of diversification away from China to countries like India.


Daniel Ives, managing director of equity research at Wedbush Securities, told CNN Business that the ongoing production shutdown in Foxconn’s sprawling campus in the central Chinese city of Zhengzhou was an “albatross” for Apple.


“Every week of this shutdown and unrest we estimate is costing Apple roughly $1 billion a week in lost iPhone sales. Now roughly 5% of iPhone 14 sales are likely off the table due to these brutal shutdowns in China,” he said.


In a note Friday, Ives said Black Friday store checks show major iPhone shortages across the board.


“Based on our analysis, we believe iPhone 14 Pro shortages have gotten much worse over the last week with very low inventories,” he wrote. “We believe many Apple Stores now have iPhone 14 Pro shortages … of up to 25%-30% below normal heading into a typical December.”


Ming-Chi Kuo, an analyst at TF International Securities, wrote on Twitter that more than 10% of global iPhone production capacity was affected by the situation at the Zhengzhou campus.

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