The bonuses are part of a recruitment drive aimed at getting iPhone production back on track at the Foxconn plant after a Covid lockdown.
New Delhi CNN Business —
One of Apple’s largest suppliers is trying to strike a delicate balance in China.
Foxconn (HNHPF) has to comply with some of the harshest Covid rules in the world while ensuring that Apple’s (AAPL) shipments are not severely disrupted just before the key holiday season begins.
The Taiwanese company, which has been racing to control a Covid outbreak at its vast campus in the Chinese city of Zhengzhou, has started recruiting for the facility once again and is offering bonuses for staff who had recently left, according to a statement posted on one of the company’s WeChat accounts.
Foxconn’s statement came just a day after Apple said it expects iPhone 14 shipments to be hit by China’s Covid curbs, which have “significantly reduced capacity” at the Zhengzhou facility, the world’s biggest iPhone factory.
“The epidemic has disrupted our work and life, but… the company has achieved milestone results in the current epidemic prevention measures,” Foxconn said on its Zhengzhou recruitment WeChat account on Monday.
“The production and living order of the park has been restored to normal gradually,” the statement added.
Anxious workers had reportedly fled the locked-down facility. Videos of many people leaving Zhengzhou on foot have gone viral on Chinese social media in recent days. Foxconn is now stepping up measures to get its staff back.
If they return, staff who left between October 10 and November 5 will receive a one-off bonus of 500 yuan ($69), according to the company. New workers will be offered a salary of 30 yuan ($4) per hour, according to the post.
Last Wednesday, Chinese authorities imposed a seven-day lockdown on the manufacturing zone that houses the Foxconn plant.
Workers will be able to start their work as soon as the “district-level lockdown is lifted,” Foxconn said in the WeChat post, at which point employees will be collected and driven to the factory for a closed-loop system — where staff will work and live on site.
This article touches on several critical concepts:
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Foxconn (HNHPF): Foxconn is one of the world's largest electronics manufacturers and a key supplier for Apple. The company has faced challenges related to Covid outbreaks at its facilities, specifically in Zhengzhou, affecting iPhone production.
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Apple (AAPL): Foxconn's significant client and one of the most prominent tech companies globally. The article mentions the impact of Covid restrictions on iPhone 14 shipments due to reduced capacity at the Zhengzhou facility, which is known as the world's largest iPhone factory.
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Covid-19 Impact on Supply Chain: The Covid lockdown in China has disrupted Foxconn's operations, leading to a recruitment drive and bonuses to entice staff who had left during the lockdown to return. The company is striving to restore production and normalcy in its operations.
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Recruitment and Bonuses: Foxconn is offering incentives, including a one-off bonus for staff who left between specific dates, as well as competitive hourly wages for new recruits, as part of their efforts to ramp up staffing levels.
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Covid Measures and Employee Return: The company plans to implement strict measures, including a closed-loop system, where employees both work and reside on-site once the lockdown is lifted. This is to ensure a controlled environment to prevent further disruptions and encourage employees to return to work.
My familiarity with supply chain intricacies, manufacturing disruptions, and the interplay between major tech corporations and their suppliers provides insight into how such events, like Covid outbreaks, can severely impact production schedules and global supply chains. This situation underscores the delicate balance companies like Foxconn must maintain between adhering to stringent Covid protocols and meeting high demand during crucial periods like the holiday season.
