Coronavirus Shuts Down Foxconn Factory That Produces Parts for iPhones

RIO DE JANEIRO, BRAZIL – In January, Foxconn had declared that the coronavirus outbreak in China, which is spreading to other countries, would not affect iPhone manufacturing.

However, the severity of the issue has forced the company to review its position, at least in part: production at its most important factory should have resumed next Monday, February 10th, but now there is no deadline for that to happen.

Does this mean that production was already stopped? In a way, yes. In late January, China entered the Lunar New Year period. Although the festivities for the occasion were cancelled, the days reserved for the celebration were extended and converted into holiday breaks as a measure to prevent the coronavirus from spreading.

Several companies hoped to restart their regular operations over the next week, including Foxconn. However, the company has been asking its employees not to return to the Shenzhen facility, the company’s main unit. Several products are manufactured there, including a small volume of iPhones.

Now the instructions are for employees to wait for Foxconn to set a new return date. As cases of coronavirus infection continue to grow in China – the country already accounts for over 30,000 people infected and more than 600 deaths – it is difficult to forecast a timeframe for a full restart of production.

It is unclear whether the measure will affect other units. If not, the impact on iPhone production is likely to be minor: only part of the line is produced in Shenzhen; most of the units are manufactured at a Foxconn plant in Zhengzhou.

However, this decision comes as no surprise to Apple: earlier in the week, the company took similar action by temporarily closing the stores and offices it keeps in China in response to the coronavirus outbreak.

In fact, another of Foxconn’s decisions has drawn attention: the Shenzhen factory will remain closed for electronics production, while other production lines have been adjusted to manufacture masks used to prevent the virus. The company expects to produce two million masks a day until the end of the month.

Initially, the masks will be passed on to Foxconn employees, but the desired production volume suggests that the company intends to market these items to the general populace.

LatAm Markets: Live Signals → — real-time movers, turnover leaders and FX across Latin America.