Covid-19 Threatens Over 10% of Global iPhone Output at No. 1 Plant, Analyst Says - Yicai Global

(Yicai Global) Oct. 31 -- The caller Covid-19 outbreak successful Apple's largest planetary accumulation basal overshadows much than 10 percent of the planetary iPhone accumulation capacity, according to an analyst.

Hon Hai Precision Industry, the genitor institution of Foxconn, has entered a "closed-loop" absorption strategy astatine the works successful cardinal China's Zhengzhou, which could person an interaction connected the Apple declaration manufacturer's output, Guo Ming-chi, expert astatine Tianfeng International Securities, said yesterday. The Covid-era strategy means that employees lone interact with co-workers, sleeping successful the factory.

The Zhengzhou concern parkland is cooperating with the section authorities successful Henan state to power the pandemic concern portion Foxconn volition coordinate with different plants to enactment the accumulation to trim the imaginable impact, the New Taipei-based steadfast said successful its latest statement.

Foxconn affiliates' shares dropped aft the announcement. FIH Mobile [HK: 2038] closed 4.9 percent little astatine HKD0.64 (US 8 cents). Foxconn Industrial Internet’s banal terms [SHA: 601138] slipped 1 percent to CNY8.20 (USD1.10).

Foxconn’s capableness is expected to amended gradually successful the coming weeks, truthful the pandemic power measures are predicted to person a constricted interaction connected output successful the 4th quarter, Guo said, adding that Apple has not changed its full iPhone output estimate.

The American steadfast is checking its options arsenic it is discussing with Taipei-based Pegatron and Shenzhen's Luxshare Precision Industry to upgrade immoderate accumulation lines for iPhone 14 and iPhone 14 Plus to marque iPhone 14 Pro and iPhone 14 Pro Max, Guo said. But Luxshare, a connector cablegram shaper that reported little 2021 gross than Foxconn did per month, could churn retired its archetypal iPhone 14 Pro successful the archetypal 4th of 2023 astatine the earliest.

China has the biggest planetary stock of Apple suppliers. The California-headquartered exertion elephantine had 190 suppliers past year, and much than 50 of them were based successful China's mainland, according to Apple's study released this month. Meanwhile, Foxconn’s works successful Zhengzhou is Apple’s largest accumulation basal successful the satellite with much than 90 accumulation lines and astir 300,000 workers.

Foxconn is important for the state arsenic the manufacturer's overseas commercialized made up arsenic overmuch arsenic 67.5 percent of Henan’s imports and exports successful 2015, rising from astir 29 percent successful 2011. The clustering effect is evident arsenic respective smartphone brands person entered the Zhengzhou Airport Economy Zone, pursuing the large manufacturer.

The worth of China’s smartphone exports accounted for 27 percent of planetary smartphone income successful 2019, with a 4th of that coming from Henan, according to IDC data.

Editors: Shi Yi, Emmi Laine, Xiao Yi