Apple uses factories in China to manufacture iPhones, and Apple has had a lot of bad publicity over the years related to those factories. For more than a decade reports have surfaced about worker protests, labor law violations and employee suicides at Apple’s Chinese plants. Things really flared up again last week at a Foxconn factory in Zhengzhou, which makes iPhones, when workers revolted, claiming Foxconn had cheated them out of bonuses and pay.
Since October, Foxconn has seen thousands of employees leave the factory after it instituted “closed-loop” measures to try and curb Covid 19. Closed-loop means that workers live in dormitories at the Foxconn campus and have no contact with the outside world. But many people fled the factory when the closed-loop measures were implemented.
In order to entice new workers, Foxconn promised signing bonuses and better pay. But last week, workers began protesting that Foxconn reneged on the pay packages. Widely disseminated videos showed workers clashing with security guards and shouting “Give us our pay!” according to The Guardian. Security guards in white hazmat suits were filmed smashing workers over their heads with batons.
A day after the protests began, Foxconn issued a statement blaming the whole fiasco on a “technical error.”
“Our team has been looking into the matter and discovered a technical error occurred during the onboarding process,” said Foxconn in a statement. “We apologize for an input error in the computer system and guarantee that the actual pay is the same as agreed on the official recruitment posters.”
But workers are not appeased. It’s now gotten to the point where Foxconn is offering to pay protestors to leave. According to CNN Business, Foxconn is offering about $1,400 to protesting workers if they’ll board buses and leave the compound.
Shipments of iPhone 14
During all of this labor strife in China, Apple has remained totally mum.
Meanwhile, analysts and business news outlets are focusing on the impact that these workers’-rights abuses will have on iPhone 14 shipments. The Zhengzhou plant is the largest factory for iPhones produced in China.
Wedbush Analyst Dan Ives said that Apple could see an iPhone shortfall of 5% and perhaps as much as 10% depending on how the next few weeks go in China.
Ives also said that many Apple stores saw major iPhone 14 Pro shortages over Black Friday and the holiday weekend in the U.S., and delivery dates have been pushed into early January in some cases.
"The zero China Covid policy has been an absolute gut punch to Apple's supply chain with the Foxconn protests in Zhengzhou a black eye for both Apple and Foxconn," Ives wrote in a research note.