iPhone factory lockdown shows risks of China dependence, analysts say
The lockdown of Foxconn's Zhengzhou factory, the world's biggest producer of iPhones, has highlighted some of the risks of relying on zero-Covid China's manufacturing sector, analysts told AFP.
Foxconn, Apple's principal subcontractor, has seen a surge in Covid-19 cases at its Zhengzhou site, leading the company to lock down the vast complex in a bid to keep the virus in check.
Images then emerged of panicking workers fleeing the site on foot in the wake of allegations of poor conditions at the facility, which employs hundreds of thousands of workers.
Foxconn is China's biggest private sector employer, with over a million people working across the country in its around thirty factories and research institutes.
But Zhengzhou is the Taiwanese giant's crown jewel, churning out iPhones in quantities not seen anywhere else.
"In a normal situation, almost all the iPhone production is happening in Zhengzhou," said Ivan Lam, an analyst with specialist firm Counterpoint.
Apple manufactures more than 90 percent of its products in China, which is also one of its most important markets.
"For Apple, it is once again a bad example in terms of the stability of production chains," Alicia Garcia Herrero, Asia-Pacific manager for Natixis bank, told AFP.
Experts say the company's heavy dependence on China "brings potential risks, especially when the US-China trade war shows no signs of de-escalating," according to Dezan Shira & Associates, a consulting firm.
Opened in 2010, the Zhengzhou factory employs up to 300,000 people who live on-site all year round -- creating a sprawling tech hub known as "iPhone city".
It is made up of three factories, one of which produces the iPhone 14 -- Apple's newest handset model.
Apple did not respond to AFP's request
Read more on tech.hindustantimes.com
