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According to Nikkei Asia, Pegatron, a Taiwanese firm that is one of a handful that assembles the iPhone, has paused production at two sites in Shanghai and one in Kunshan to comply with the Chinese government’s onerous COVID-19 requirements. China has implemented tough measures in reaction to the recent rise of COVID-19 in the country.
Pegatron Halts production of Apple iPhones
Pegatron, the iPhone assembler, announced in a stock market statement on Tuesday that activities at its two production locations in Shanghai and Kunshan, China, had been halted to comply with regulatory rules.
According to Nikkei Asia, these are Pegatron’s only iPhone production bases because its new iPhone assembly factory in India has not yet begun operations. Pegatron manufactures around 20% to 33% of all iPhones.
Pegatron told Nikkei Asia that it is in contact with its customers and suppliers while adhering to local government restrictions and that it aims to begin production shortly.
Both Pegatron and Apple may suffer as a result of the closure. According to Nikkei Asia, those Pegatron factories are the company’s only iPhone production centers, and Pegatron is responsible for “approximately” 20 to 30 percent of all iPhones. Pegatron “hopes to begin manufacturing shortly,” according to the newspaper, but it’s unclear when that will be.
Apple did not respond quickly to a request for comment. According to Nikkei Asia, Quanta, which contributes to the manufacture of MacBooks, has also paused production at a plant in Shanghai.
Throughout the epidemic, supply chain concerns have been a continuous issue, hurting businesses in a variety of industries. In reaction to China’s regulations, Tesla had to close its Shanghai manufacturing, for example. Furthermore, the worldwide chip scarcity has made it more difficult to purchase certain consumer goods.
What else we know so far:
Quanta, the world’s largest contract notebook manufacturer and a key MacBook manufacturer, told Nikkei Asia that it has been halting production at its key manufacturing site in Shanghai’s Songjiang district since the beginning of April in order to comply with the government’s COVID prevention measures.
Quanta, whose clients include Dell and HP, has around 20% of its entire laptop capacity in Shanghai. It also produces various Internet of Things goods and servers in the city for non-US destinations. Compal Electronics, a major iPad and notebook manufacturer, has also suspended operations at its Kunshan facility, according to the business.
Dozens of tech suppliers, including Unimicron and Nan Ya Printed Circuit Board, two critical printed circuit board producers, as well as BizLink, a significant Dell and Tesla supplier, have already announced they have ceased activities in and around Shanghai since April 2.
According to the Taiwan Financial Supervisory Commission’s latest survey, which was published on Monday, around 161 Taiwan-listed businesses, many of which are electronics suppliers, have been forced to suspend production in Shanghai and the Kunshan districts, one of China’s largest electronics centers.
The newest COVID-19 wave has already reached Suzhou, Jiangsu Province, another important concentration of electronics makers.
A more compact iPhone assembler Luxshare Precision Industry, or Luxshare-ICT, has its single assembly factory in Kunshan.
According to two persons acquainted with the situation, the facility is still working under closed-loop supervision and stringent COVID protection procedures. Closed-loop management entails personnel and workers living and working wholly on-site, and companies rely heavily on inventory housed within the complex.
