- Foxconn Zhengzhou Plant New Shipments to Fall Further – Source
- Worker dissatisfaction at the plant escalated into protests this week
- Over 20,000 workers, mostly new recruits, have left the company – source
TAIPEI, Nov 25 (Reuters) – Foxconn (2317.TW) The flagship iPhone plant in China is expected to further reduce its November shipments amid the latest worker unrest this week, a source with direct knowledge of the matter said on Friday, as thousands of workers walked out.
The company could now see more than 30% of the site’s November output affected, up from an internal estimate of up to 30% when the factory’s worker problems began in late October, the source said.
The site, which is the only factory where Foxconn makes premium iPhone models, including the iPhone 14 Pro, is unlikely to resume full production by the end of this month, the source added.
The biggest apple in the world (AAPL.O) The iPhone factory has been grappling with tough COVID-19 restrictions that have fueled worker discontent and halted production ahead of the Christmas and Lunar New Year holidays in January as many workers either isolated themselves or fled the factory.
It has fueled concerns about Apple’s ability to deliver products for the busy holiday season, as the Zhengzhou plant accounts for 70% of global iPhone shipments and produces the US company’s popular iPhone 14 models.
Workers, most of whom were newly hired in recent weeks, clashed with security guards on Wednesday.
Many claimed they were mistaken for compensation payments at the factory, and others complained about sharing dormitories with colleagues who had tested positive for COVID.
Foxconn apologized for a wage-related “technical error” in hiring on Thursday and later offered 10,000 yuan ($1,400) to protesting new recruits who agreed to quit and leave.
The source said more than 20,000 workers, mostly new hires who weren’t yet working on production lines, took the money and left. Videos posted to Chinese social media on Friday showed crowds and long lines of workers laden with luggage queuing for buses.
“It’s time to go home,” one person posted.
Foxconn, officially known as Hon Hai Precision Industry Co, declined to comment. Apple, which said Thursday it had employees at the factory, did not immediately respond to a request for comment on Friday.
The plant employed more than 200,000 people before its woes began. It has dormitories, restaurants, basketball courts and a soccer field on its sprawling 1.4 million square foot facility.
Another Foxconn source familiar with the matter said some new hires had left campus, but didn’t elaborate on how many. This person said that their departures would not cause any further damage to ongoing production as the employees leaving the company had not yet been trained or had started work.
“The incident has had a major impact on our public image but little on our (current) capacity. Our current capacity is unaffected,” the source said.
“There’s only so much companies can do for pandemic prevention… It’s been a problem for a while. This is an issue everyone is facing,” the person said, pointing to other worker unrest sparked by tough COVID restrictions, including upheaval at another Apple supplier Quanta (2382.TW)in May.
Foxconn shares closed down 0.5%, underperforming the broader market, (.TWII) which ended flat.
($1 = 7.1616 Chinese Renminbi Yuan)
Reporting by Yimou Lee; Additional reporting by Brenda Goh; Edited by Anne Marie Roantree, William Mallard and Gerry Doyle
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