Foxconn has denied rumors it is dismantling iPhone production lines

Foxconn has denied rumors it is dismantling iPhone production lines in China to relocate to India

Taiwanese company Foxconn, a leading contract manufacturer of the iPhone and other Apple devices, has denied rumors it has dismantled assembly lines at a manufacturing complex in Shenzhen. According to the Hong Kong-based SCMP portal, concerns are growing on Chinese social media about the country’s possible loss of a leading role in Apple’s manufacturing chain.

    Foxconn factory in Shenzhen.  Image source: Agence France-Presse

Foxconn factory in Shenzhen. Image source: Agence France-Presse

Earlier this month it was reported that Foxconn is planning to invest in building a new facility in India amid escalating tensions between Beijing and Washington. Because of this, there have been rumors of relocation of assembly lines from China. However, the Taiwanese company has not yet officially announced any new investments in India. In contrast, a Foxconn spokesman said a number of social media posts about laying off temp workers and dismantling production lines in Shenzhen were fake, adding that the company in the city is carrying on as usual.

According to the SCMP, Foxconn’s response indirectly indicates that China will remain the most important part of the production chain for the company. In February, the company’s management thanked the Henan provincial government for its help in maintaining iPhone production at its Zhengzhou plant during last fall’s COVID-19 outbreak. The provincial authorities, in turn, confirmed that the government will provide a comprehensive production service – the largest iPhone factory in the world is located here.

Foxconn announced in February that it would build a smart warehouse on a leased site in Zhengzhou. Nonetheless? There are visible signs of adjustment in dealing with the local workforce. A recent visit by journalists to the local Foxconn recruitment center turned up only about a dozen applicants. This was in stark contrast to the July picture, when thousands of potential workers were present in the same center – just before the peak of production of new iPhone models, when job seekers were promised bonuses equivalent to more than $1,000. Simultaneously, more than 2,000 were happening daily People the recruitment center, including hundreds who arrived in buses and cars provided by local recruitment agencies.

This time, an ad at the center indicates that new employees will receive a minimum of 2,460 yuan (about US$350) and a small one-time bonus of 160 yuan. While production at the plant had recovered 90% as of December 30 following the outbreak of COVID-19, hiring doesn’t appear to be as intense as it used to be. Apple is rumored to be making India its new main manufacturing region, leveraging lessons learned from working with China. It is believed that the company is moving the vector of its activities to a neighboring country, and India is considered not only as a manufacturing base, but also as a potential sales market, which will eventually be split into a separate reporting region by the manufacturer, as sales are steadily growing here.

According to DigiTimes experts, India is likely to collect up to half of all iPhones by 2027, compared to 5% in 2022, not lagging behind China in volume. Earlier, representatives of the Indian authorities stated that by next year smartphones should be among the top ten export products – in 2014 they were practically not exported here at all.


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Johnson Smith

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