What you need to know
- Apple suppliers are aiming to resume full-scale production on February 10.
- That's in spite of thousands of known cases, limited travel, and a rising death toll.
- Foxconn, Apple's main manufacturer remains confident it will restart its facilities on schedule.
Apple suppliers in China have their sights set on a return to full-scale production on February 10, in spite of a rising number of infections and deaths caused by the coronavirus.
According to Bloomberg:
Apple Inc.'s major suppliers in China, including iPhone-maker Hon Hai Precision Industry Co., plan to resume full-scale production in the country Feb. 10, despite the coronavirus that has infected thousands and limited travel.
Foxconn's Hon Hai, the most important manufacturer for the U.S. company, said Tuesday it still expects to be able to restart facilities throughout China on schedule, according to a text message sent to Bloomberg News. Suppliers such as Quanta Computer Inc., Inventec Corp. and LG Display Co. also said they would go back to work next week in China.
While Chinese officials and companies have targeted Feb. 10 as the date to resume work in much of the country, doubts about the timing have grown in recent days as the virus death toll rises, workers, find themselves stuck in municipal lockdowns and the transport of people and goods has been hampered. More than 20,000 people have been infected with the virus and more than 400 have died.
One analyst said that the main variable would be a government-issued delay to production, which is reportedly unlikely given "the complexities of organizing transportation for the returning migrant workers."
However, a more recent report from DigiTimes claims that Foxconn may not begin operations at its Wuhan plant until after February 13:
Foxconn Technology Group's (Hon Hai Precision Industry) plant in Wuhan, China will not begin operation until after February 13, but the suspension of the production there will not create a major problem to the company, since the facility will be able to catch up with the shipment delivery schedule in a very short time, the sources said. Foxconn is also monitoring all its plants' statuses in China via an internal command center, they said.
On Saturday, February 1, Apple announced that it was closing its entire China operation until February 9 out of an abundance of caution.
The full impact of the coronavirus remains unclear, but it could have a devastating impact on Apple in the long run. Apple maintains that it is monitoring developments closely, and is working with employees and partners in the region. During the Q1 2020 earnings call, Apple also announced that it had restricted travel to the region to "business-critical" situations.
Apple and its suppliers will no doubt be keen to get things moving again as soon as possible. Apple has already been forced to issue wider-than-normal guidance for Q2 2020, and several of its suppliers are also predicting that coronavirus and delayed production will impact business over the coming months.