Apple's leading supplier, Foxconn, has been forced to suspend operations in Shenzhen, China, following a city-wide lockdown that sees nonessential businesses close, public transportation halted, and residents advised not to leave their home unless for essential activities only.
As Nikkei Asia reports:
Shenzhen is home to major tech companies such as Huawei, Oppo and TCL, and is also one of the biggest manufacturing hubs for Taiwan's Foxconn, supplying clients from Apple to Google to Amazon. The semi-lockdown comes as the global supply chain is still struggling with an ongoing chip shortage, as well as disruptions from the war in Ukraine.
Foxconn, the world's biggest contract electronics manufacturer, said in a statement on Monday that it would suspend production at its Longhua and Guanlan factories in Shenzhen until further notice from the local government. It has activated plans to use facilities in other cities to support production.
It is not entirely clear what devices Foxconn produces for Apple at its two Shenzhen plants, but Foxconn is the largest maker of the iPhone. The new lockdown adds strain to an already crippled global supply chain that's impacting Apple's business.
Apple said the chip shortage cost it $6 billion in the last quarter of 2021, with bullish views on the impact the shortage will have in the coming quarters. Apple is planning a slew of new product launches around the world next week, including the all-new Mac Studio, Studio Display, new iPhone SE, iPad Air, and new colors of the iPhone 13 and iPhone 13 Pro.
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