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A man stands in front of an Apple store in Shanghai on January 5. Photo: EPA-EFE

MacBook manufacturer Quanta Computer halts production in Shanghai, putting supplies of Apple’s top-tier laptops at risk

  • The Taiwanese manufacturer said it has suspended production to comply with Shanghai’s Covid-19 control measures, which have severely squeezed supply chains
  • Quanta is known for producing MacBook Pros, which could contribute further to Apple shortages after Pegatron Corporation stopped making electronics for brands

Taiwanese manufacturer Quanta Computer said on Wednesday that it has halted production in Shanghai due to pandemic control measures, putting production of Apple’s latest MacBook Pro laptops at risk.

The company said in an announcement on its official website that the temporary closure is in line with pandemic control measures required by the Shanghai government, and it does not know when it will be able to resume production.

Ming-Chi Kuo, a TF International Securities analyst known for his reliable reports on Apple, noted that Quanta is essentially “the sole supplier of high-end MacBook Pros”. Demand has been strong for the latest top-tier MacBook Pros, which launched at the end of last year with Apple’s powerful new M1 Max processor. Now delivery times have “roughly increased by 3-5 weeks after the China lockdown,” Kuo said on Twitter.

Quanta and Apple did not immediately respond to requests for comment.

Shanghai, a city of 25 million, announced a two-stage lockdown late last month in an effort to control the outbreak of the Omnicron Covid-19 variant. The measures follow the country’s “zero-covid” policy, in contrast with many other countries that have moved towards living with the virus.

Shanghai’s initial lockdown was scheduled to be lifted on April 5, but as the case count kept climbing, the financial hub has effectively remained a ghost town. Most residents are still confined to their homes.

Quanta, whose Shanghai entity was at one point the second-largest exporting company in the mainland, is one of the few Taiwanese companies to have a significant impact on China’s economy. Amid rising tensions between Beijing and Washington, it was among the companies that relocated some of its business operations back to Taiwan at the end of 2018 over the prospects of a trade war. Tariffs imposed by then-president Donald Trump made exporting to the US from mainland China prohibitively expensive.

In addition to Shanghai, Quanta also has operations in Changshu, in eastern Jiangsu province, and the central city of Chongqing, according to its official website.

Apple supply chain hit by lockdowns in Shanghai, Kunshan

The outbreak in Shanghai, along with neighbouring provinces Zhejiang and Jiangsu, has caused widespread disruptions to manufacturing activities in the Yangtze River Delta region. Widespread lockdowns and other control measures have also upended logistics, driving up costs and creating long delays.
In another blow to Apple’s supply chain, major manufacturing service provider Pegatron Corporation stopped making computers, communication devices and consumer electronics for branded vendors in Kunshan, a manufacturing base in Jiangsu, after the city entered a lockdown a week ago.

Additional reporting by Yaling Jiang.