Foxconn’s largest iPhone assembling plant was reported to have subjected workers to horrible working conditions, which may have been the reason why protesters have started rioting in the city of Zhengzhou. These turn of events are expected to have serious ramifications for Apple’s iPhone shipment estimates for the next quarter.
Disgruntled Protesters Have Also Clashed With Law Enforcement Personnel as the Situation Becomes Dire
Workers have violently engaged with police, according to various clips spotted on Twitter. The reason for these protests may have something to do with working conditions. Earlier, Foxconn was forced by the Chinese government to temporarily halt production and enforce stricter rules due to an increase in COVID-19-positive cases. Naturally, Apple’s supply chain had to comply, but at the expense of the workers’ well-being.
Earlier, employees stationed at the factory who chose to remain anonymous complained that due to the COVID-19 lockdown, there were food and water shortages, creating a sense of anxiety among workers. Foxconn was later reported to have offered a measly one-time bonus of $69 to employees willing to come back and stabilize iPhone production. The lowball offer likely made matters worse.
The Chinese company’s Zhengzhou plant is one of the most critical sites for Apple since it is the largest iPhone factory in the world. It employs around 200,000 workers and can assemble 70 percent of the world’s iPhones. Due to the COVID-19 restrictions, Apple published a press release stating that the iPhone 14 Pro and iPhone 14 Pro Max would see reduced shipments during the holiday season.
More riots broken out at Foxconn factory in communist #china's Zhengzhou. Violence clashes escalated by both CCP & chinese rioters, tear gas grenades were fired as chinese rioters returned hostiles w/ fire distinguisher. pic.twitter.com/5OU7dXAiiE
— Northrop Gundam ∀🦅⚔️ (@GundamNorthrop) November 23, 2022
For Apple, this setback could not have arrived at a worse time since a large percentage of the company’s iPhone revenue is generated during this quarter. Due to such problems, Apple reportedly revised its iPhone 14 shipment estimates from 90 million to 87 million. Also, with the U.S. government instating a trade ban for various firms present in China, it might become difficult for Apple to maintain business with such companies, which is why it is expanding operations in countries like Vietnam and India.
Unfortunately, it will take a few years before iPhone production in the aforementioned regions matches what the Zhengzhou facility can churn out annually, so Apple will have to figure out a workaround. In the meantime, Foxconn could be in conversation with its biggest client on how to appease factory workers who were a part of the protests in the thousands. After all, iPhone production needs to stabilize, otherwise, a massive drop in shipments will likely happen.
News Source: Reuters