Apple: Wait time for iPhone 14 Pro models in China extends to Jan 2023
In most years, a slick, straightforward rollout and the new iPhone are absolutely synonymous. This year though, a smooth rollout for the iPhone 14 is almost a far-fetched fantasy. That’s a fact which reflects the growing difficulties involved in doing business in China. The no-holds-barred approach to stopping Covid-19 throughout China has even led Apple to declare that it will not be able to produce enough phones to meet the demands of the holiday season.
The biggest contributing factor to such a previously unheard-of pronouncement? The uncertainty looming around the world’s largest iPhone factory, in the city of Zhengzhou. For starters, China’s “zero Covid” policy has been slowing factory output across the country, and the iPhone factory owned by Foxconn Technology Group, the biggest iPhone maker, was not spared the slowdown.
When Covid-19 cases started to specifically spike in the area, Foxconn walled its roughly 200,000 workers inside the grounds of a factory that can produce as much as 85 percent of the world’s iPhones, according to Counterpoint Research. But it wasn’t long before Covid started to spread and Foxconn struggled to balance business demands with the country’s ultra-strict pandemic policy.
The assembler initially offered workers an extra US$14 a day to continue working. It later nearly quadrupled that amount, to US$55 a day, when workers began to fear for their lives and fled. The factory was then forced to operate at “significantly reduced capacity,” Apple said. It has been unclear ever when operations will return to full capacity.
Inevitably, the production slowdown in Zhengzhou forced Apple to warn investors — for the third time in three years — that sales would be affected by pandemic-related disruptions to its operations in China. Now, Apple has once again extended the wait time in mainland China for its most popular iPhone 14 models beyond Christmas.
If ordered today, how long before a customer in China will receive their iPhone 14 Pro?
A check on Apple’s China website on Monday showed a five-to-six week waiting time for the iPhone 14 Pro and Pro Max models, with the latest delivery stretching out to January 3, 2023. That wait is a week longer than it took in early November, and two weeks longer than orders made in late October. The base models – the iPhone 14 and iPhone 14 Plus – are available for same-day delivery or in-store pickup.
A state-backed weekly magazine in China reported last week that the world’s largest iPhone factory, operated by Foxconn, is in need of 100,000 workers to resume full production capacity in the central Chinese city of Zhengzhou. According to China Newsweek, in Taikang, a county in Henan province with 1.5 million residents, the facility has asked for 10,000 workers but only 2,000 have been hired so far.
Separately, according to Shanghai-based Cailianshe, an online financial news service provided by the state-run Shanghai United Media Group, as many as 72,000 people had registered their intent to work for Foxconn in an internal hiring system by Wednesday, citing unidentified local labor agencies. Alas, strict Covid-19 quarantine requirements were still affecting recruitment.
In general, all of the latest Apple iPhone models in China have suffered from an extension in lead time (the time between the initiation of production and its completion), according to a recent report by JPMorgan. It indicated that the two iPhone 14 Pro models had the longest lead times across all regions. JPMorgan also highlighted that China alone accounted for 15% of all iPhone shipments worldwide.
Since the launch in September, Apple has witnessed a rapid fall in its weekly iPhone sales in China. Even adjusting for the device’s earlier release this year, the negative trend holds and has been worse than the recent drops for Android rivals, Jefferies analysts including Edison Lee wrote in a note in October.
30 November 2023