Bloomberg Sees Potential for Foxconn Factory COVID Closures
15 APRIL 2022 - The goods news: Foxconn’s main iPhone factory in Zhengzhou is running fill tilt. The bad news: Foxconn’s main iPhone factory in Zhengzhou is just a few positive COVID tests away from going lights out. That seems to be the message from a Bloomberg piece. According to that:
Local authorities in Zhengzhou, where Foxconn Technology Group operates its main iPhone-making complex, ordered compulsory testing for areas that include the plant and adjacent parts of the city.
The worry, from the business-centric Bloomberg, is that an outbreak will lead to a shutdown, which would seriously slow the Apple cash cow that is iPhone. According to the report, the “mass-testing exercise represents a risk because Chinese officials have been quick to lock down areas in the event of positive tests.” Of course, the risk of not closing is more COVID. Sorry to be “that guy,” but it should be remembered - we’re talking about living, breathing people, who’d probably like to go on living and breathing.
That said, Bloomberg’s business brain does note that China has already shutdown iPhone maker Pegatron and MacBook maker Quanta over the past few weeks, “spelling more trouble for an already fragile global tech supply chain.”
As far as iPhone goes, if there is a disruption, most analysts think that will lead to delayed sales, not lost sales. Commenting on the possibility of iPhone disruption earlier this week, Piper Sandler analyst Harsh Kumar argued folks who want iPhones and can’t get them will wait until iPhones become available.
