In reaction to a government-imposed lockdown on the tech hub, Apple Inc. supplier Foxconn has halted operations at one of its Shenzhen locations, which builds iPhones. Hon Hai Precision Industry Co., a Taiwanese business, has its China headquarters and a major manufacturing facility in Guanlan.
The firm stated in a statement that it is suspending operations at the two campuses and has moved manufacturing to other locations to minimise the impact of the disruption. The length of the suspension was not specified by Foxconn. The Chinese government has ordered that non-essential enterprises in Shenzhen be shut down until March 20.
While the shutdown may have an impact on many of the items Foxconn produces for Apple and other companies, demand for electronics normally troughs in the first quarter of each year after the holiday season.
Hon Hai, the principal iPhone assembler, closed 1% down in Taipei on Monday. The company said in a stock exchange filing late Monday that the temporary suspension will have no “significant” impact on its finances and business for the time being.
On Saturday, China reported more than 3,300 Covid-19 cases, the country’s deadliest epidemic since the pandemic began, and officials increased lockdowns to stop the spread.
The majority of Foxconn’s iPhones are made at a plant in Zhengzhou, China’s centre metropolis, which has earned the moniker “iPhone City.” Its Guanlan location is of a smaller size. The corporation was one of the first to be affected by the coronavirus outbreak two years ago when it ordered employees to avoid its Shenzhen headquarters as a precaution.
On Sunday, China put Shenzhen’s 17.5 million citizens on lockdown for at least a week in an attempt to contain a rising Covid-19 outbreak. According to a government announcement, the shutdown would be accompanied by three rounds of citywide mass testing after viral cases nearly doubled statewide to about 3,400. Shenzhen’s central business district has previously been subjected to restrictions.
All bus and metro lines have been shut down, and all companies have shuttered except those that provide critical services. Huawei Technologies Co., SZ DJI Technology Co., and Tencent Holdings Ltd. all have headquarters in Shenzhen, which also has one of China’s busiest ports.