COVID-19 lockdowns in China disrupts manufacturing at key Apple suppliers

COVID-19 lockdowns in China disrupt manufacturing at key Apple suppliers

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COVID-19 lockdowns in Shanghai and neighboring Kunshan have disrupted key manufacturers of Apple Inc. products, with suppliers forced to halt manufacturing.

The companies affected by the lockdowns include Pegatron Corp., which makes iPhones in Shanghai and Kunshan; Quanta Computer Inc., which makes MacBooks for Apple and devices for Dell Corp. and HP Development Co. LP in the Songjiang district of Shanghai; and Compal Electronics Inc., which manufactures iPads in Kunshan.

Nikkei Asia reported today that the companies affected have been forced to halt production since the beginning of April in line with the government lockdown orders. Although the factories are not the only suppliers of Apple products — Foxconn is the best known — the Foxconn plant in Shenzen that makes iPhones was forced to cease operations temporarily last month after COVID-19 lockdowns It has since resumed production.

The critical takeaway for Apple is that key supply lines across the board are being disrupted and there is seemingly no prospect for manufacturing in Shanghai and Kunshan to resume. Although not yet seen in retail supply, the effect will be a likely shortage of Apple products in the coming months.

The lockdown in Shanghai started on March 28 amid a surge of Omicron cases and was initially meant to last only a week but has now been extended indefinitely. The lockdown has resulted in nearly unprecedented scenes for mainland China, where the Chinese Communist Party does not allow for dissent.

There have been reports of rioting and looting in Shanghai amid food shortages and even thousands of residents screaming from their balconies against the government and the lockdown. The CCP responded by sending a drone telling residents to keep quiet and comply with restrictions.

Amid the scenes of widespread dissent, the Chinese government has slightly eased some restrictions. Starting Monday, there is now a three-tier disease control system that allows residents in areas where no cases have been reported for 14 days to leave their homes so long as they follow health protocols and remain in their sub-district.

Photo: Wikimedia Commons

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