Manpower woes at Foxconn’s ‘iPhone City’ may cut shipments of Apple’s handsets by a fifth this holiday quarter

Name: iPhone 14 delays expected after days of violent protests at Foxconn Zhengzhou factory
Uploaded: 2022-11-30T12:00:14.000Z
Duration: 2 min 23 s
Description: iPhone 14 delays expected after days of violent protests at Foxconn Zhengzhou factory

Production at the plant, located in central China, was significantly affected by workers’ protests, according to analyst Kuo Ming-chi

Shipments of the higher-end iPhone 14 Pro and 14 Pro Max are expected to fall short by 15 million to 20 million units

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Coco Fengin Beijing

Published: 8:00pm, 30 Nov 2022

Apple could ship 20 per cent fewer smartphones this holiday quarter than previously expected, as the world’s largest iPhone factory, operated by Foxconn Technology Group in the central Chinese city of Zhengzhou, struggles to keep up with production under a Covid-19 outbreak.

Despite the company’s efforts to keep assembly lines running while complying with China’s strict pandemic controls, fear of coronavirus infections and disagreements over work arrangements have led to an exodus of workers last month, followed by violent clashes last week.

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iPhone 14 delays expected after days of violent protests at Foxconn Zhengzhou factory

The plant’s production “was significantly affected by labourers’ protests”, with an average of just 20 per cent of the factory’s capacity being used in November, wrote Kuo Ming-chi, an analyst covering Apple at TF International Securities, in his blog on Tuesday. The utilisation rate is expected to rise to only 30 to 40 per cent in December, he said.

As a result of the manpower shortage, Kuo has slashed his forecast for total iPhone shipments by a fifth to between 70 million and 75 million units for the December quarter – typically Apple’s biggest – with shipments of the higher-end iPhone 14 Pro and 14 Pro Max falling short by 15 million to 20 million units.

Foxconn, which usually hires some 300,000 people to cope with the holiday season, is estimated to have lost tens of thousands of workers last month after a coronavirus outbreak stoked concerns about spreading infections and potential lockdowns.

The company, formally known as Hon Hai Precision Industry, managed to fill some vacancies with new hires, but many were urged to leave after they staged a violent protest over work allowances.

Foxconn is now seeking to lure back veteran workers, but while the city of Zhengzhou has lifted its strictest pandemic controls, several areas in the Zhengzhou Airport Economy Zone, a satellite town 40 kilometres away from the city centre and home to the factory, are still designated as high risk.