Iphone Factory ChinaSource: Apple

What you need to know

  • A new report says the iPhone 12 is contributing directly to air pollution in China.
  • Morgan Stanley says it is tracking air quality data in Chinese cities where Apple makes its products.
  • They conclude that a rise in pollution is directly related to iPhone 12 mass production.

A new report from Morgan Stanley says that the production of the iPhone 12 is directly contributing to a rise in pollution in some Chinese cities.

As CNBC reports:

Morgan Stanley analysts on Wednesday said they are tracking air quality reports in Chinese cities that suggests an increase in industrial activity tied to iPhone 12 production...

Whilst the report in part details how the iPhone 12 seems to be directly contributing to poorer air quality in cities, Morgan Stanley uses the data as one indication as to how iPhone 12 manufacturing is going:

Apple investors are looking for clues as to how the production of the finished devices is going in order to better project sales in the coming quarters.

For Morgan Stanley, air quality is one such clue.

Morgan Stanley says that it is tracking nitrogen dioxide levels in four Chinese cities where Apple has a strong manufacturing presence. Analyst Katy Huberty states:

"As of October 26th, air quality data from Zhengzhou, also known as 'iPhone City,' shows that industrial production levels have spiked higher recently, about a month later than historical seasonality, which we believe coincides with the ramp in iPhone 12 mass production"

The report in part reflects how higher-than-expected levels for this time of year correlate with the delayed schedule of the iPhone in 2020. In July, Apple released its new environmental vision, declaring its goal to become carbon neutral by 2030. Of the 21.5 million metric tons of CO2 released by Apple in 2019, 76% of it came from product manufacturing, the kind indicated in this report. Apple has already taken some steps to reduce this, claiming that removing the charger from the box of its iPhone lineup will save the company 2 million metric tons of CO2 every year, the equivalent of taking 450,000 cars off the road.