According to JP Morgan analysts, the suspension of Foxconn’s activities in the Chinese city of Shenzen would have no substantial impact on Apple’s iPhone manufacturing. It is subject to additional limitations to contain a COVID outbreak.
According to Hon Hai Precision Industry, also known as Foxconn, Apple’s principal supplier, the company has halted operations in Shenzhen until further notice. It would establish backup plants to minimise disturbance to customers.
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As per an analyst analysis issued on Monday, the impact of the Shenzhen lockout on the iPhone EMS should be negligible (up to a maximum of 10 per cent of worldwide iPhone production), given the low season and the company’s limited exposure to Shenzhen, according to Hariharan.
According to JP Morgan, Hai’s iPhone production capacity is less than 20% concentrated in Shenzhen. Most assembly plants are located in Zhengzhou, a central industrial and transportation hub in eastern China.
More On Shenzhen’s Lockdown!
Several factories in China are compel to shut down due to the restrictions. Notably those of automobile giants owners like Toyota and Volkswagen.
In the wake of these production halts, the brokerage does not anticipate a quick rise. In context to component supply throughout the industry; instead, it believes that lockdowns in the Shanghai region may be more disruptive.
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While the lockdown in Shenzhen, China’s Silicon Valley, is unlikely to impact semiconductor production substantially. According to a storey published by Bloomberg, it is conceivable that the global supply of LCD panels would be disrupted.
