Inside a Chinese iPhone Plant, Foxconn Grapples With Covid Chaos

HONG KONG— Foxconn Technology 2354 -0.76%

The group is struggling to contain a weeklong outbreak of Covid-19 at an iPhone factory in central China, trying to calm scared and frustrated workers during a crucial period for smartphone orders.

At Foxconn’s main factory in Zhengzhou, the largest Apple assembly site in the world Inch

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iPhones, hundreds of thousands of workers were placed under a closed-loop system for almost two weeks. They are mostly cut off from the outside world, only allowed to move between dormitories or dormitories and production lines.

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Many said that they have been locked in their rooms for days and that the distribution of food and other necessities is chaotic. Many others say they are too scared to continue working because of the risk of infection.

Foxconn on Wednesday denied what it said were online rumors that 20,000 cases had been detected at the site and said it was providing necessary supplies for a “small number of employees affected by the pandemic.”

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“The sudden outbreak has disrupted our normal life,” Foxconn said in a post to its workers on WeChat on Friday.,

social media platform. “Orderly progress in pandemic prevention and outcomes depends on the efforts of all staff,” it said. He outlined plans to ensure adequate food supplies and mental health support and promised to address workers’ concerns.

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Foxconn did not respond to the worker’s question about the details of the situation at the construction site. Earlier when asked about the situation, the company referred to its Wednesday statement as well as its Friday post on WeChat.

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“It’s too dangerous to go to work,” a 21-year-old worker confined to the home told The Wall Street Journal, saying he was skeptical of the company’s claim that the factory had a low infection rate. .

The shutdown at Foxconn is the latest example of the economic and social consequences of China’s rigid pandemic control policies—which include swift and sweeping shutdowns, mass testing and mandatory quarantines to destroy the virus whenever it emerges. While Beijing says the virus is too powerful to allow any relaxation of its zero-contagion policy, companies must reassure their employees that there is little risk to coming to work when there are signs of an outbreak.

The outbreak in Zhengzhou – 95 cases recorded in the city in the past four days – began in early October, after people returned from other parts of the country from a week-long public holiday. At the first signs of Covid in the city, officials closed down some neighborhoods and began rounds of mass testing to eradicate the virus before it took hold among Zhengzhou’s 12.7 million residents. As a large employer, Foxconn joined the campaign.

When more infections emerged at Foxconn in mid-month, the company sought to maintain production by creating a “bubble” around its operations to reduce the risk of exposure, a practice now common among large manufacturers in China to continue operations during a local outbreak.

Foxconn says it employs as many as 300,000 workers in Zhengzhou. Analysts estimate that the company makes half or more of Apple’s smartphones in the city, making it vital for delivering iPhones to consumers, including during the upcoming winter holiday season when demand for the phones typically peaks.

Foxconn said in a statement on Wednesday that production at the site was “relatively stable” and that it was sticking to its operating outlook for the current quarter as the impact of the outbreak was manageable. Quarterly results should be announced on November 10.

Apple, in its quarterly earnings announcement on Thursday, did not mention Foxconn’s Zhengzhou factory. Its chief financial officer said supply of the new iPhone 14 Pro models is limited due to high demand.

Apple did not respond to requests for comment about conditions at the Foxconn factory.

Some workers the Journal spoke with said many colleagues refused to return to the assembly lines. Others simply left, they said, sometimes leaving their belongings behind.

Another Foxconn employee said most of his team of a dozen night-shift workers were either quarantined or refused to return to work. Every night, he said, he saw workers in protective gear waiting to be taken away by bus.

“I don’t know who around me is a positive case,” said the worker, who has been confined to his home for several days. “It would have been better for me if I had stayed at home.”

With so many people stuck in their quarters, sent to quarantine centers or simply absent from work, the pace of production on some assembly lines has slowed, two workers said.

Foxconn has created incentives to maintain production, the company said in a statement Friday.

Anyone who shows up for work will receive free meals and a daily bonus, it said. Those who show up every weekday from October 26 to November 11 will receive a reward of 1,500 yuan, or about $200.

A 21-year-old employee who spoke to the Journal, who worked on an assembly line making an older version of the iPhone, said he had been confined to his premises since Oct. 17, along with thousands of others.

Over the following days, meal deliveries were delayed and trash was left unattended in the hallways, piling up on the ground floor while several dormitories were locked, he said.

The daughter of one worker said her mother was placed in the same home as some who tested positive. Some other workers complained similarly.

Ten days ago, nearly 300 employees of supplier Foxconn were asked to move out of their dormitories and sleep in the factory, one of them said.

In photos he shared with the Journal, people slept on sheets and pillows placed on metal bed frames, under white fluorescent lights hanging from the hangar-like roof. Hygiene has become a problem, he said. Still, he said he shouldn’t leave the factory – and that he had nowhere to go if he did.

“Where can I go? Barriers are everywhere,” he said. “There are people at every checkpoint.”

Work and the pandemic

Write Wenxin Fan at [email protected] and Selina Cheng at [email protected]

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