Apple’s major supplier, Foxconn, has been forced to suspend operations in Shenzhen, China, following a city-wide lockdown that sees nonessential businesses shut, public transportation halted, and residents shut down. They are advised not to step out of their homes only for essential activities.
As Nikkei Asia reports,
Shenzhen is home to major tech companies such as Huawei, Oppo and TCL, and is one of the largest manufacturing hubs for Taiwan’s Foxconn, which supplies customers from Apple to Google to Amazon. The semi-lockdown comes as global supply chains still grapple with ongoing chip shortages as well as disruptions from the war in Ukraine.
Foxconn, the world’s largest contract electronics maker, said in a statement on Monday that it would suspend production at its Longhua and Guanlan factories in Shenzhen until further notice from the local government. This has activated plans to use facilities in other cities to support production.
It’s not entirely clear what devices Foxconn manufactures for Apple at its two Shenzhen plants, but Foxconn is the largest maker of the iPhone. The new lockdown adds tension to an already crippled global supply chain that is affecting Apple’s business.
Apple said the chip shortage cost it $6 billion in the last quarter of 2021, with bullish thoughts on the impact of the reduction in the coming quarters. Apple plans to launch several new products around the world next week, including the all-new Mac Studio, Studio Display, the new iPhone SE, iPad Air, and new colors for the iPhone 13 and iPhone 13 Pro.
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