After the unrest, over 20,000 employees at the largest iPhone factory in China have accepted offers of 10,000 kroner to leave the factory.
The largest iPhone factory owned by Foxconn, located in Zhengzhou, China, has been the scene of unrest this week. Discontent among the workers escalated into protests in recent days and there were several clashes with security personnel.
Finally, Foxconn apologized yesterday for a pay-related "technical error" that occurred after hiring the latest batch of employees who claimed to have been misled about compensation benefits. The company offered each protesting new employee the equivalent of nearly 10,000 kroner to resign and leave the company.
20,000 leave the largest iPhone factory
More than 20,000 employees should have accepted that offer. Most of these employees were new hires who had not yet worked on the production lines and who took the money and left. Before the situation started, more than 200,000 employees worked at the factory.
Nevertheless, several leading financial media in the US write that all this has the potential to affect iPhone production and thus deliveries quite seriously in a negative direction. As early as November 7, Apple said it expected fewer deliveries of the iPhone 14 Pro and Pro Max than previously expected.
This could mean 10 million fewer iPhones
Some analysts estimate that if the current problem persists through December, about 10 million fewer iPhones will be produced than originally planned. Others expect that there will be 25-30 percent fewer iPhone 14 Pros than usual heading into Christmas shopping. These are numbers that are going to affect Apple's bottom line if they hold true.
However, Reuters has spoken to a source close to Foxconn who says that the whole mess has a big impact on the company's public image, but little on its capacity. This is because the employees who took the money and left the company had not yet been trained or even started working.
The reason why there has been unrest among the employees is partly due to strict COVID restrictions and the fact that sick and healthy employees were mixed in dormitories.