Published: Tue, February 11, 2020
Markets | By Otis Pena

IPhone 9 production will likely be delayed by coronavirus

IPhone 9 production will likely be delayed by coronavirus

The company had asked employees at a facility in Shenzhen not to return to work when the extended Lunar New Year break ends on Monday, according to a memo seen by Bloomberg News.

With many reports on the deadly coronavirus which first emerged in Wuhan, China, circulating globally the "Wuhan virus" as it is widely known has now been termed a severe epidemic.

However, an anonymous source told Reuters that Foxconn has received approval to resume production at its Zhengzhou plant on Monday (Feb. 10).

Those two factories are the main players in Apple's iPhone production machine with their closure - and the knock-on impacts that will cause throughout the supply chain - likely to result in lower global iPhone shipments than had previously been forecast.

Apple rival and China's biggest smartphone maker, Huawei, said last week that it had resumed production of consumer devices and carrier equipment, and all of its Chinese operations are now running normally.

Pegatron, another Apple supplier, resumed work on the production of ‌iPhone 11‌ and the development of the new iPhone 12 at its Shanghai factory on February 3, with a 90 percent return rate, but Kuo believes the rate of work will fall to 60 or 70 percent because many factory employees will resign after being paid in February.

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Another iPhone assembler, Pegatron Corp (和碩), is also facing challenges in resuming its China production, Kuo said.

However, the lack of active production lines at Foxconn's factories means its launch could be severely impacted.

At the same time, Reuters is reporting that Hon Hai/Foxconn's request to resume production in Shenzhen has been rejected as authorities will want to check the plant again to ensure that virus control measures are properly in place. It did not give further details.

Most senior Taiwanese officials have been told to refrain from returning to China and those who needed to do so required approval from Chairman Liu Young-Way, the person said.

Employees work inside a Foxconn factory in the township of Longhua in the southern Guangdong province, China, May 26, 2010.

Its shares fell as much as 2.4 percent, underperforming a 0.3 percent decline in the broader market.

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