Shanghai lockdown: iPhone maker halts operations at China sites

The latest manufacturer to suspend operations as a result of the Shanghai lockdown is a significant producer of Apple’s iPhone.

Pegatron, a technology business, has announced that production at two of its factories in China has been temporarily halted.

On Tuesday, authorities in Shanghai relaxed some of the city’s coronavirus laws.

For the first time in weeks, some of the city’s 25 million residents will be able to leave their homes.

In late March, the city was shut down due to an outbreak of illnesses in the important manufacturing and financial centre.

Pegatron announced in a stock exchange filing that it has paused operations at its factories in Shanghai and Kunshan “in response to local government COVID-19 prevention requirements.” 

The company noted, “We will cooperate with authorities to resume operations as soon as possible.”

According to the Japanese publication Nikkei, major Apple MacBook manufacturer Quanta and iPad maker Compal Electronics have also halted operations in Chinese locations.

The shutdowns, according to Dan Ives, an analyst at investment company Wedbush Securities, will have an impact on production. So far this month, he estimates that 3 million iPhones have been compromised, “with more to follow if this continues.”

Mr Ives further stated that 2 million iPads and 1 million MacBooks could be impacted. He said, “The Pegatron closure adds fuel to the roaring fire that is Apple’s and other components of the iPhone ecosystem’s supply chain.” “This exacerbates concerns with the iPhone supply chain.”

Last month, Foxconn, a Taiwanese company that also assembles iPhones for Apple, halted operations at its Shenzhen factory.

It relocated production to other manufacturing sites while continuing operations in Shenzhen, with personnel living and working inside the plant in a closed-loop system.

Since the pandemic began in 2019, China has imposed mass closures in key cities such as Xi’an and Wuhan, affecting millions of people.

Shanghai’s lockdown is the world’s largest to date, and the city is a major financial and manufacturing hub, as well as home to the world’s largest port.