What if the “zero Covid” protests in China lowered Apple’s revenue? The Foxconn factory in Zhengzhou, the main assembly site for the brand’s smartphones, was the scene of demonstrations against the Chinese government’s anti-Covid policies in late November, a mobilization that had been suppressed by police. Previously, the site was already cut off from the world after cases of Covid-19 appeared among the employees, which had caused the authorities to restrict the employees to the site. During these events, the production of smartphones was slowed down and Apple today finds itself in uncertainty as Christmas approaches, explains Les Échos on Wednesday, December 14.
The Apple brand was hoping to take advantage of the Christmas holiday to sell the iPhone 14 Pro and Pro Max, its last two devices, to hit the market in droves. The supply was already under pressure shortly after their launch due to high demand, so the crisis in China is not helping Tim Cook’s company’s business. This Christmas period, between six and 20 million units, or between 7 and 25% of production, could be missing.
In France, it is now too late to offer an iPhone 14 Pro or Pro Max for Christmas, ordered on the Apple website. The new models ordered this week can only be delivered between 29 December and 6 January. A shortage, which mainly concerns the two latest models, with the others continuing “to be delivered well to the store”, confirms a telecom operator quoted by Les Échos. The distribution of units would also be uneven depending on the stores.
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A still uncertain situation
The situation at the Zhengzhou factory remains uncertain at this stage as the premises have been cordoned off last week, following the end of the “zero Covid” policy in the country. But the increase in Covid-19 cases in China could again affect production. In early December, Foxconn predicted a return to normal production in late December or early 2023.
It remains to be seen what impact this smartphone shortage will have on Apple’s sales at the end of the year. The Christmas period is generally logically fertile for the company, which at the same time last year had revenue of $124 billion, 60% of which was thanks to iPhones.
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