According to news agency Bloomberg on Monday, Apple supplier Foxconn is hoping to maintain the labour levels required to run the largest iPhone manufacturing in the world by giving incentives of up to $1,800 to current employees at its Zhengzhou facility in China.
According to a Bloomberg article, Foxconn, officially known as Hon Hai Precision Industry Co., would increase compensation for full-time employees who started at the beginning of November or earlier by up to 13,000 yuan per month in December and January, the company said in a message over the weekend.
Foxconn gave comparable payments to employees last week who chose to leave the company’s premises, mostly to evict newcomers who had taken part in violent demonstrations against virus lockdowns.
The unusually large prize, according to the article, is a result of Foxconn’s pressing need to restart its production lines at full capacity following a month of coping with Covid limitations and disruptions that resulted in turmoil last week. The vast majority of Apple’s iPhone Pro models are made at the Zhengzhou site, which typically has over 200,000 workers.
After the protests, more than 20,000 newly hired employees are said to have quit. According to news reports, Foxconn’s former goal of restarting full production by the end of November would be complicated by the departure of 20,000 workers. This was due to labour unrest that rocked a manufacturing unit at the largest iPhone facility in the world.
In order to resume business as usual, Apple has stated that it is collaborating closely with Foxconn. Both businesses have also stated a commitment to maintaining employee safety.
Apple’s most popular devices this year are the iPhone 14 Pro and Pro Max, which help to make up for the normal iPhone 14 models’ declining sales. The Foxconn scenario serves as yet another warning to Apple about the risks of relying on a sizable production system headquartered in China in an era of erratic policy and ambiguous trade ties.
Just in time for the busiest shopping season of the year, the US company issued a warning this month that shipments of its newest luxury iPhones will be lower than anticipated.
Earlier this month, analysts at Morgan Stanley reduced their predictions for the current quarter’s production of the iPhone Pro by 60 lakh units. In the worst-case scenario of protracted lockdowns affecting Zhengzhou assembly, Foxconn may risk as much as 36% of iPhone revenue or 20% of its overall quarterly sales.
The unusual instances of open discontent at the Zhengzhou plant that started last Wednesday were reportedly sparked by workers’ complaints of unpaid wages and annoyance at the harsh Covid-19 limits.