Foxconn Delays Return of Workers to Main China iPhone Plants

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(Bloomberg) — Hon Hai Precision Industry Co Ltd (TW:) has told some employees at its main iPhone-making unit that it’s postponing the resumption of production, a sign of the struggles Apple Inc.’s (NASDAQ:) primary partner is having with the novel coronavirus.

Hon Hai, known also as Foxconn, sent a message via its internal app on Sunday that it wouldn’t be able to decide on a back-to-work date “until further notice” for its iDPBG business unit, according to a version reviewed by Bloomberg News. That division makes gadgets for Apple at a factory in the so-called iPhone city of Zhengzhou in central China and two other plants in Shenzhen. It’s not clear how many employees received the message and whether other workers were summoned back.

Foxconn declined to comment on the message and said on Monday its factories will comply with government requirements, and resume output in an “orderly manner” by staggering the return of workers.

The internal directive is bound to fuel more confusion over when the assembler of electronics to most of the world’s largest tech brands will fire up its factories. Foxconn has told employees at its southern Shenzhen headquarters not to return to work when the extended Lunar New Year break ended Feb. 10, according to a memo obtained by Bloomberg.

Not all of its employees returned to their hometowns for the holiday break so there’s still some available workers on production sites, according to people familiar with the plant operations. But it’s unclear as to how many such workers are on hand.

The unit could also struggle to hire back workers after the holiday period. A recruitment app for iDPBG shows that two of its plants in Shenzhen had received only 800 applications from former workers as of Monday morning. The facilities are seeking as many as 3,000 ex-workers.

Apple and Foxconn were among the first corporations to try and quantify the epidemic’s impact. Hon Hai slashed its 2020 outlook last week, anticipating disruptions to Apple’s carefully calibrated production chain as well as weaker consumer demand and overall economic growth. As China’s largest private employer and a key partner to many of the world’s most recognizable consumer brands, Foxconn has become a high-profile symbol of how the outbreak could disrupt Chinese manufacturing and hence the world’s supply of electronics.

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