Foxconn’s woes to take bigger toll on giant China iPhone plant as more workers leave -source

  • Foxconn’s Zhengzhou plant’s November shipments will fall further – source
  • Worker discontent at the factory erupted into protests this week
  • More than 20,000 workers, mostly new hires, have been let go – source

TAIPEI, Nov 25 (Reuters) – Foxconn’s ( 2317.TW ) flagship iPhone plant in China is expected to further reduce its shipments in November due to labor unrest this week, the A source with direct knowledge of the matter said Friday, as thousands of workers left the site.

Sources said the company could now see more than 30% of the site’s production hit in November, up from an internal estimate of 30%, when labor problems at the factory began in late October.

The site, which is the only factory where Foxconn makes premium iPhone models including the iPhone 14 Pro, is unlikely to resume full production until the end of this month, the source added.

The world’s largest Apple ( AAPL.O ) iPhone factory is grappling with strict COVID-19 restrictions that have fueled discontent among workers and disrupted production ahead of the Christmas and January Lunar New Year holidays. Because many workers were either isolated or fled. the plant

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This has raised concerns about Apple’s ability to deliver products for the busy holiday period.

On Wednesday, workers, many of them newly hired in recent weeks, clashed with security personnel at a factory in Zhengzhou, central China.

Many claimed they were misled about compensation benefits at the factory, and others complained about sharing dormitories with co-workers who had tested positive for COVID.

Foxconn apologized Thursday for a “technical error” related to pay during the hiring process, and later offered 10,000 yuan ($1,400) to the protesting new hires who agreed to resign and quit.

According to the source, more than 20,000 workers, most of whom are new hires who do not work on the production lines, took their money and left. Videos posted on Chinese social media on Friday showed long queues and workers laden with luggage for buses.

“It’s time to go home,” one person posted.

Foxconn, formally known as Hon Hai Precision Industry Co., declined to comment. Apple, which said Thursday it has workers at the factory, did not immediately respond to a request for comment Friday.

The factory, before its disaster began, employed more than 200,000 workers. It has dormitories, restaurants, basketball courts and a soccer field throughout the approximately 1.4 million square meters (15 million square feet) of facilities.

Another Foxconn source familiar with the matter said some new hires have left the campus but did not elaborate on the number. This person said that since the people who left were not trained yet or had not started their work, their departure will not harm the current production.

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“Incidents have a huge impact on our public image but our (current) capacity is small. It doesn’t affect our current capacity,” the source said.

“There’s only so much corporate can do to contain the outbreak … it’s been a problem for a while. It’s a problem that everybody’s facing,” the person said, referring to other employee unrest that has led to severe Due to COVID restrictions, including disruptions in the bill. Apple’s supplier, Quanta ( 2382.TW ), in May.

Shares of Foxconn closed up 0.5%, after the broader market, (.TWII) that ended flat.

Hundreds of workers took part in protests at Foxconn’s giant iPhone factory in Zhengzhou, China this week, with some men breaking surveillance cameras and windows, photos posted on social media showed.

($1 = 7.1616 Chinese Yuan Renminbi)

Reporting by Yemo Lee; Additional reporting by Brenda Gow; Editing by Anne Marie Rountree, William Mallard and Gary Doyle

Our Standards: The Thomson Reuters Trust Principles.

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