Foxconn will resume production on February 10. Can Apple breathe a sigh of relief?
Latest update time：2020-02-05
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According to Reuters on February 4, analysts said that if the shutdown of Chinese factories due to the new coronavirus is extended for another week, Apple's iPhone may be out of stock.
About 70% of the world's smartphones are manufactured in China, and the mobile phone market may be affected by the epidemic. Domestic mobile phones such as Huawei and Xiaomi will face severe challenges.
In response, Foxconn's parent company Hon Hai Precision Industry Co., Ltd. stated that it is still planning to resume operations at its foundry factories across the country on February 10.
Image source: Reuters
As a major supplier of Apple, Foxconn is facing the problem of suspension of work and production, which will affect the production capacity of products such as iPhone. In response to this situation, Tianfeng Securities analyst Ming-Chi Kuo predicts that Apple
's iPhone shipments will drop by 10% in the first quarter
of this year
.
At the same time, considering the potential impact of the new coronavirus epidemic, major smartphone manufacturing centers such as Guangdong have been affected, which may
affect Foxconn's quarterly revenue
. Hon Hai Precision Industry Group has lowered its revenue growth forecast for 2020. Hon Hai Chairman Liu Yangwei recently said: "Considering the current market environment, it is currently expected that sales in 2020 will increase by 1-3%, lower than its forecast of 3-5% on January 22, and far lower than the average forecast of 5.4% by analysts."
The market is closely watching the impact of the epidemic on the electronics industry
. In fact, large technology companies such as Foxconn and TSMC are trying their best to ensure that their factories resume work as scheduled under the fierce epidemic.
Foxconn is the largest contract manufacturer for Apple mobile phones, and the Zhengzhou Foxconn factory alone contributes more than half of Apple's production.
It is understood that Apple has about 10,000 directly employed employees in its retail and corporate entities in China, and its supply chain has more than 1 million workers, producing products such as iPads, iPhones and Apple Watches.
In response to the epidemic prevention and control and the industry's concerns, Foxconn's Zhengzhou, Apple iPhone assembly base, announced on February 4 that it would enter
"full closed management"
. Foxconn pointed out that the goal of resuming work on February 10 remains unchanged, and the epidemic prevention work of local governments will also help the group resume production line operations.
It is understood that Foxconn's factories in Zhengzhou include Hongfu Jin Precision Electronics Zhengzhou Company in Zhengzhou Xinzheng Comprehensive Bonded Zone, which is the headquarters of Foxconn in Zhengzhou.
In addition, there is a Futaihua Precision Electronics Zhengzhou Company in Zhengzhou's Export Processing Zone, which is called the Economic Development Zone Branch;
and Fuding Precision Electronics Zhengzhou Co., Ltd. in Baisha Town, Zhongmu, which is usually called Foxconn Zhongmu County Branch.
Industry insiders believe: "If work resumes on February 10, employees will not be able to return to work 100%. Due to traffic problems and isolation caused by the closure or semi-closure of some cities,
it is estimated that less than 70% of employees will return to work
, compared with 80-90% of employees returning to work after the Spring Festival in previous years."
Secondly,
logistics is also a major challenge
. Affected by more and more urban traffic restrictions, the transportation and circulation of goods will be difficult in the future. Although it will not lead to a "chain break", the shortage of personnel and transportation difficulties will have an impact on the subsequent supply situation, which deserves close observation.
Morningstar Securities analyst Tang Yao believes that Apple's
diversified supply chain
is sufficient to ensure that it will not be greatly affected by the epidemic.
It is reported that Apple plans to launch new products at the spring conference in March this year, and is expected to mass-produce affordable iPhones this month. But now, Foxconn is still in the shutdown stage, and Apple is even facing a shortage of stocks. To solve this problem, Foxconn is trying to use factories in
India, Vietnam, Mexico
and other places to deal with the supply shortage caused by the epidemic.
However,
the Indian market is also facing the possibility of out-of-stock
. It is reported that ASUS India is temporarily out of stock of some products due to the epidemic. In addition, mobile phones produced in India still need to rely on China to supply parts, such as batteries and display screens.
According to Apple's official website on February 1, "Based on recent public health and prevention considerations, the mainland retail stores will be temporarily closed from now until 24:00 on February 9.
Currently, Apple's online store in China can still operate normally."
In addition, affected by the novel coronavirus pneumonia epidemic, Samsung Electronics and LG Electronics decided to suspend the operation of some experience stores and factory production in China until February 9. It seems that Apple is not the only manufacturer facing problems such as shortages. At this moment, everyone is in the same boat and overcomes the difficulties together!
This article is compiled from Sina Technology, deep Tech, Jinshi Data, Observer.com, etc.
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