After reporting over 1,800 coronavirus cases on Sunday, China has imposed a complete lockdown in the cities of Shenzhen and Shanghai. The health measure has impacted Apple’s supply chain again because most of its suppliers in Shenzhen have closed their production plants like Foxconn, General Interface Solutions (GIS) Holding, Unimicron, and others.
According to Nikkie Asia, the Shenzhen government has suspended public transportation, and nonessential businesses, and has put all industrial parks and residential areas under lockdown in the city for a week. People are also instructed to travel outside the city only if it is necessary.
Apple suppliers halt production in China until March 20
Apple’s major iPhone assembler, Foxconn has its second-largest manufacturing hub in Shenzhen, China. In a statement, the manufacturer said that it has suspended production at its facilities in Longhua and Guanlan in the city until further directives from the local government but plans to use plants in other cities to keep support production. Nikkie Aisa writes that;
Shenzhen is Foxconn’s second-largest manufacturing hub in China, after Zhengzhou in Henan Province, which is the world’s biggest iPhone production center. Much early engineering prototyping and research and development work is conducted at the campuses in Shenzhen.
Apple’s other supplier, General Interface Solution Holding (Foxconn’s touch panel subsidiary) has also announced the closure of operations in Shenzhen and has allocated production to other units.
At the Q1, 2022 earning call, Apple CEO Tim Cook said that the company’s supply constraints are going to ease in the upcoming quarter which will not only create a steady supply and demand of products but also further increase its sales. But the situation is still volatile due to the rise in COVID positive cases in different parts of the world.
Maybe, the new lockdown could worsen the already strained global supply chain affected by chip shortage and war in Ukraine. Apple recently launched the new iPhone SE 3 and green iPhone 13 models, the COVID lockdown in China could extend their delivery dates by a few weeks.