There is no doubt that the Covid-19 pandemic will be studied in the history books. As well as its social, economic and health consequences. But also how some countries have managed a crisis that, apparently, they refuse to take for granted. And it is clear that the pandemic is not over, but China continues to carry out a strict Covid 0 policy that, now, threatens to hit the world’s largest iPhone-producing factory.
The cases that have appeared around the Foxconn plant in Zhengzhou, which employs around 200,000 people and is responsible for producing most of Apple’s phones, could jeopardize the Christmas season. And that the supply of the new iPhone 14 is limited worldwide.
Chinese authorities have announced a seven-day lockdown of non-essential activity in the area around the iPhone factory. Apple, for now, has decided to keep quiet. However, for the tech giant this is one of the key campaigns of the year and the extension of the confinement could jeopardize its good numbers this year.
Apple has broken profit and revenue records by the pull of the iPhone and the Mac, with almost 100,000 million net profit and 400,000 million in sales this year. Contrary to other companies in the sector concerned about the falls in their numbers.
iPhone production could drop by 30%
The economic zone of the Zhengzhou airport in central China and where the 415 square kilometer Apple plant is located, has been in quarantine since last Wednesday and, for now, it will be until noon on November 9.
Residents of this vast area cannot leave their homes and, in addition, they must take PCR tests once a day. Public transport services are suspended and offices, shops and non-essential services have been closed.
The authorities are clear: any violation of the rules will be “severely dealt with” by the police and urges people to cooperate to “obtain victory in this district’s fight against the epidemic.”
According to Reuters sources, if this confinement continues, the production of Apple iPhones in Zhengzhou could fall by up to 30% this month. Apple could have acted already, giving the order to increase production in its other factory located in Shenzhen, in the south of China, to make up the deficit. Although this is a smaller factory and with less productive capacity.
Last year, as reported by Wedbush analyst Daniel Ives, iPhone 13 sales set an all-time holiday sales record with 40 million units sold. What it shows the importance for Apple of these last weeks of the year.