Foxconn’s founder Terry Gou Tai-ming said on Thursday that production resumption at its factories in China has “exceeded expectations.” Foxconn assembles a number of Apple products including iPhones at its factories in China.
The production at Foxconn factories was disrupted due to the coronavirus outbreak in China. After an extended period of shutdown, Foxconn resumed operations at its factories towards the end of February. However, it said that it will take some time for production to go back to its full capacity. The virus outbreak was contained in China thanks to the shut down in Wuhan and other neighboring areas. The outbreak has peaked in the region with fewer than 10 cases being reported today, though it is now spreading in other parts of the world.
Gou told reporters in Taipei that the return to work effort at Foxconn’s factories in China had “exceeded our expectations and imagination”, and that supplies to its plants there and in Vietnam had returned to normal.
The February shutdown saw Foxconn’s register its biggest revenue drop in a month in nearly seven years. The company has already slashed its revenue estimates for the quarter. The Foxconn founder also expressed concerns over the electronics supply-chain in Japan and South Korea which are currently struggling with the COVID-19 outbreak. He is also worried about the virus outbreak in the United States as it impacts Foxconn’s key market. The company might be able to ramp up production of iPhones and other Apple products but the virus outbreak in the United States could lead to a noticeable drop in demand thereby further affecting its revenues.
The virus outbreak in China hit Apple hard in February as it reportedly saw a 60% decline in iPhone sales during the month. March is unlikely to be better as the virus outbreak is now affecting other major countries like Italy, the U.S., Japan, and others.[Via SCMP]