Apple Inc’s manufacturing partner Hon Hai Precision Industry Co (鴻海精密) is trying yet another special payout to workers in China to soothe unrest and restore production at the world’s biggest iPhone factory, a flashpoint in Beijing’s efforts to sustain its economy while fighting COVID-19 infections.
Hon Hai, also known as Foxconn Technology Group (富士康科技集團), is offering workers who left the Zhengzhou complex between Oct. 1 and Nov. 10 an extra 30 yuan (US$4.18) an hour on top of their regular wages through next month and January, as well as a returnee bonus of 500 yuan.
They can get a 3,000 yuan bonus after staying 30 days, plus another 6,000 yuan in January if they work 23 days or more, according to a notice posted on social media service WeChat.
Photo: Ann Wang, Reuters
Foxconn and Apple rolled out a series of extra payments and incentives after violent protests broke out against lockdowns imposed at the factory to address a rise in COVID-19 infections.
The companies said over the weekend they would pay as much as 13,000 yuan a month next month and January to full-time workers who had joined at the start of this month or earlier.
Apple is facing a shortfall of iPhone 14 Pros during the critical holiday shopping season because of production problems in China. The companies estimate the troubles in Zhengzhou would cut output by close to 6 million units of the Pro devices, its most in-demand models.
The phones start at about US$1,000, suggesting that could represent at least US$6 billion in lost revenue.
Customers buying Apple’s most premium devices in the US this year can now expect to wait as long as 37 days, said Counterpoint Research, which monitors delivery times every year.
That is far higher than the predecessor iPhone 13 Pro family and longer than the initial launch of the current generation.
Delivery days are “increasing significantly” for iPhone 14 Pro and Pro Max models across all markets, Counterpoint analysts said.
Counterpoint’s research is based on averaged data the firm collects three to four times per week. The current wait time in certain locations, including California, is 30 days.
“It’s unfortunate for Apple to be short of its flagship Pro series going into the holiday season, especially if buyers end up pivoting to a competing product,” International Data Corp devices research vice president Bryan Ma (馬伯遠) said. “The good thing for Apple is that it has plenty of ecosystem stickiness to contain most of the leakage and satiate this demand in the following quarters.”
This year’s iPhone Pro models are more critical to Apple than ever, as they have been making up for sluggish demand for its regular iPhone 14 series.
The Cupertino, California-based company cut back its production plans for the lower-end devices earlier this month because of that disappointing demand.
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