Foxconn has announced that its headquarters, and one of its iPhone plants, will not re-open on February 10. Monday was scheduled to be the date on which Chinese businesses would resume operations after an extended break to limit the spread of the coronavirus.
The news comes on the same day that we learn Apple Stores in China are also unlikely to re-open on this date…
Bloomberg saw the memo to employees working in Foxconn’s Shenzhen facility.
[Foxconn, formally known as] Hon Hai Precision Industry Co. told employees at its Shenzhen facility not to return to work when the extended Lunar New Year break ends Feb. 10, according to a memo obtained by Bloomberg News […]
“To safeguard everyone’s health and safety and comply with government virus prevention measures, we urge you not to return to Shenzhen,” Foxconn wrote in a text message sent to employees. “We’ll update you on the situation in the city. The company will protect everyone’s work-related rights and interests in the duration. As for the happy reunion date in Shenzhen, please wait for further notice.”
The company had earlier announced that production at its biggest iPhone plant in Zhengzhou would instigate quarantine measures in order to allow it to re-open on February 10. A statement by the company leaves open the possibility that this too will not re-open on time.
“As a matter of policy and for reasons of commercial sensitivity, we do not comment on our specific production facilities,” Foxconn said in a statement in response to Bloomberg’s queries. “We have been closely monitoring the current public health challenge linked to the coronavirus and we are applying all recommended health and hygiene practices to all aspects of our operations in the affected markets.”
We earlier summarized the position to date.
CEO Tim Cook had previously stated that the coronavirus outbreak creates ‘uncertainty’ for the company, with Apple choosing to forecast a wider-than-usual guidance range for the current quarter.
The store closures, and those of other outlets for Apple products, will hit sales in China, but the bigger impact is likely to be on production. Although Apple’s key suppliers are currently stating that they plan to resume operations on February 10 – with extraordinary measures being implemented to achieve it – some doubt that this will be the case, or that desired production levels will be achieved.
Noted Apple analyst Ming Chi-Kuo, who has good supply-chain sources, suggests that iPhone production may be 10% down in the current quarter, and that the outlook for the following quarter is unclear.
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