iPhone Maker Foxconn Restarts Production in Shenzhen As Lockdown Partially Lifts

Apple's primary iPhone assembler Foxconn says it has resumed production at its Chinese manufacturing plant in Shenzhen, following a partial lifting of the city-wide lockdown that came into effect on Monday.

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The Taiwanese company told Reuters it had restarted some production and operations at its Shenzhen campus after meeting government conditions for staff to live and work in bubble arrangements and adopting a "closed-loop management" system.

The system was used successfully during the Winter Olympics in Beijing and kept event personnel tightly sealed off from the public, with regular testing for those within.

"Some operations have been able to restart and some production is being carried out," Foxconn said in a statement, adding that the system at its Shenzhen facilities subjected employees living there to the required health measures.

"This process, which can only be done on campuses that include both employee housing and production facilities, adheres to strict industry guidelines and close-loop management policies issued by the Shenzhen government," it added.

It's not known which Apple products Foxconn produces at its two Shenzhen plants, but Foxconn is the largest maker of the ‌iPhone‌. Manufacturers in Guangdong province, home to Shenzhen, said factory shutdowns have caused lags in deliveries, while logistical difficulties were making it harder to ship goods to overseas customers.

Foxconn on Wednesday conceded that 2022 would be "challenging" for the supply chain and forecast an up to 3% fall in revenue for the year – its first annual sales decline in six years – as a shortage of chips squeezes smartphone production and the pandemic shows no sign of easing in China.

Apple said the chip shortage cost it $6 billion in the last quarter of 2021, but predictions remained bullish for this year despite these strains on the global supply chain. That's despite Foxconn's warnings that the chip shortage is expected to run into the second half of 2022.

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Tags: China, Foxconn

Top Rated Comments

tridley68 Avatar
7 months ago
Timmy time to look for another supplier instead of being dependent on one place like maybe a factory in the United States.
Score: 11 Votes (Like | Disagree)
Dwalls90 Avatar
7 months ago

The problem is labor costs and availability. However, as SOCs become more prevalent and incorporate more of what once was done with discrete chips it may become more feasible since less labor would be required and a product could be designed for automated production.

A more likely short term solution is offshoring in more locations.
Yep. With the capilistic mindset of America, until people take priority over profits, manufacturing will continue to be offshored. The same folks complaining that we should bring manufacturing back to America also do not want to pay double or triple for the price of their Apple products, and something has got to give (hint: it's not going to be Apple's profits).
Score: 8 Votes (Like | Disagree)
jlc1978 Avatar
7 months ago

Timmy time to look for another supplier instead of being dependent on one place like maybe a factory in the United States.
The problem is labor costs and availability. However, as SOCs become more prevalent and incorporate more of what once was done with discrete chips it may become more feasible since less labor would be required and a product could be designed for automated production.

A more likely short term solution is offshoring in more locations.
Score: 6 Votes (Like | Disagree)
SFjohn Avatar
7 months ago

Tired of the same old excuse about labor costs. A 5000 dollar computer only a small fraction is labor costs. It’s all about maximum profits at the long term expense of the Country and future generations.

Even more salt to the wound is when you order equipment costing over 500K and it’s made in China. Same stuff that used to be made here and actually cost less in the past.

We used to make everything in the US and people were able to afford things in fact someone a few years out of high school would be able to purchase a home and retire in the future.
It really has nothing to do with labor costs, it’s all about training (education) and availability - Apple can hire 6,000 engineers over the course of 1 week for seasonal employment overseas. That’s impossible here.
Score: 5 Votes (Like | Disagree)
citysnaps Avatar
7 months ago

Timmy time to look for another supplier instead of being dependent on one place like maybe a factory in the United States.
Apple manufactures via Foxconn (on the average) roughly 600,000 iPhones per day, a can quickly ramp that up or down on a moment's notice, depending on market requirements.

Where do you suggest Apple manufacture their phones/iPads/computers that can support their manufacturing requirements?

Timmy? Really? What's with the belittling/disparagement? To feel better?
Score: 4 Votes (Like | Disagree)
jlc1978 Avatar
7 months ago

Yep. With the capilistic mindset of America, until people take priority over profits, manufacturing will continue to be offshored. The same folks complaining that we should bring manufacturing back to America also do not want to pay double or triple for the price of their Apple products, and something has got to give (hint: it's not going to be Apple's profits).
It's not just that. You have to have a workforce with the skills to do assembly, and a large enough quantity as well. The US doesn't have that, and you can't build it overnight. Even if you could, it's not an aspirational job, since keeping costs down means salaries will stagnate and drive turnover, so you would need a constant supply of new workers. In addition, you need sophisticated assembly lines and a supply chain in place to feed JIT manufacturing. That, with automated production, is much easier to accomplish and something American companies have experience doing. It's also a path US manufacturing has been on for a long time.
Score: 4 Votes (Like | Disagree)

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