Foxconn sees COVID-hit China plant back at full output in late Dec-early
Jan -source
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[December 05, 2022] By
Yimou Lee
TAIPEI (Reuters) - Apple supplier Foxconn expects its COVID-hit
Zhengzhou plant in China to resume full production around late December
to early January, a Foxconn source said on Monday, after worker unrest
last month disrupted the world's biggest iPhone factory.
The world's largest contract electronics maker later on Monday said
revenue in November fell 11.4% year on year reflecting production
problems related to COVID-19 controls at the major iPhone factory.
"At present, the overall epidemic situation has been brought under
control with November being the most affected period," the company said
in a statement, adding it has started to recruit new employees and was
gradually "restoring production capacity to normal".
Foxconn said November revenue for its smart consumer electronics
business, which includes smartphones, declined year on year partly due
to a portion of shipments being impacted by production disruptions in
Zhengzhou. It did not elaborate.
The Zhengzhou plant has been grappling with strict COVID-19 restrictions
that have fuelled discontent among workers over conditions at the
factory. Production of the Apple device was disrupted ahead of Christmas
and January's Lunar New Year holidays, with many workers either having
to isolate to combat the spread of the virus or fleeing the plant.
![](http://archives.lincolndailynews.com/2022/Dec/05/images/ads/current/napa_sda_HFH_2022.png)
Following the November unrest, that saw workers clash with security
personnel, Foxconn could have seen more than 30% of the Zhengzhou site's
November production affected, Reuters reported last month citing a
source familiar with the matter. Foxconn hasn't disclosed details of the
impact of the disruption on its production plans or finances.
Analysts say Foxconn assembles around 70% of iPhones, and the Zhengzhou
plant produces the majority of its premium models including iPhone 14
Pro.
"The capacity is now being gradually resumed" with new staff hiring
under way, said the person with direct knowledge of the matter. The
person declined to the named as the information was private.
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![](../images/120522PIX/busine33.jpg)
The logo of Foxconn is pictured on top
of a company's building in Taipei, Taiwan October 31, 2022.
REUTERS/Carlos Garcia Rawlins/File Photo
![](http://archives.lincolndailynews.com/2022/Dec/05/images/ads/current/werth_lda_HFH_2022.png)
"If the recruitment goes smoothly, it could take around three to
four weeks to resume full production," the person said, pointing to
a period around late December to early January.
Foxconn and the local government are working hard on the recruitment
drive but many uncertainties remain, according to the source. The
person cited "fears" some workers might have about working for the
company after the plant was hit by protests last month that
sometimes turned violent.
"We are firing on all cylinders on the recruitment," the person
said.
Foxconn declined to comment.
A second Foxconn source familiar with the matter said the company is
hoping to resume full production "as soon as possible" but was not
able to give a timeline.
"The situation has stabilised," the person said, referring to the
protests and the government's easing of COVID restrictions. "The
local government is actively helping with the resumption."
The Taiwanese company said last month it expects a slight decline in
fourth-quarter revenues year-on-year for its smart consumer
electronics business and significant growth for cloud and network
products.
Foxconn said on Monday its overall revenue in the fourth quarter was
expected to be "roughly in line with market consensus", without
elaborating. It did not offer a fresh outlook for its various
business sectors.
The company said last month that revenue in the final three months
of this year would be flattish, and that it has a relatively
conservative outlook for 2023.
Foxconn shares closed flat, in line with the broader market which
ended up 0.1%.
(Reporting by Yimou Lee and Ben Blanchard; editing by Kenneth
Maxwell and Jason Neely)
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