China’s tumbling smartphone exports, Foxconn disruptions raise supply chain concerns as firms seek to ‘avoid risks’
- Henan province, home to the world’s largest iPhone factory, assembled and exported 8.4 million smartphones in October, down by 1.7 million from the previous month
- Recent production at the Zhengzhou factory has been disrupted since October, adding to concerns over supply chain relocation
02:23
iPhone 14 delays expected after days of violent protests at Foxconn Zhengzhou factory
Coronavirus-induced manufacturing disruptions in China, highlighted by smartphone exports from a major industrial region dropping sharply in October, have increased concerns over supply chain relocation amid an already bleak export outlook.
Henan province, which is home to Foxconn’s mega iPhone factory in its capital city of Zhengzhou, assembled and exported 8.4 million smartphones in October, down by 16.9 per cent from 10.2 million in the previous month, according to Chinese customs data.
This comes despite Apple releasing the new iPhone 14 series in mid-September, while the decline is especially alarming amid an intensifying trend of manufacturers diversifying away from China to the likes of India and Vietnam, analysts said.
Foxconn epitomises China
“Foxconn epitomises China,” said Zhang Zhiwei, chief economist at Pinpoint Asset Management.
Orders from the United States were the most affected, with the number of shipments from Henan dropping by over 1 million, or nearly a fifth month-on-month, to 4.37 million, which pushed the export value down by more than US$609 million, customs data showed.
In the first 10 months of the year, Henan’s exports totalled US$67.15 billion, half from nearly 60 million assembled smartphones – with more than 50 per cent bound for the US.