Foxconn Technology Group—which makes Apple iPhones, among other electronics—says its factories in China will return to full operation at the end of this month, despite the ongoing coronavirus outbreak in the country.
“As of today, the production resumption rate has reached 50 percent of seasonal capacity,” Foxconn Chairman Young Liu said in a Tuesday investors' call. “Based on the current schedule, we should be able to reach full seasonal capacity by the end of March.”
Despite that upbeat outlook, Liu nevertheless said the coronavirus is still creating “uncertainties” for the company’s business at a time when researchers are trying to understand the disease.
“If there is a second outbreak or something happened in the (Foxconn) campus, we have some quarantine process,” Liu said. “But if the outbreak [becomes a] worldwide outbreak, then we don’t know. Then it’s out of our control.”
The manufacturing giant made the statements two weeks after Apple said the coronavirus outbreak in China was creating a supply shortage for iPhone models. Foxconn said the outbreak will have a “significant negative” impact on its revenue for this quarter across all its manufacturing segments, which includes assembling other consumer electronics, like video game consoles, TVs, and PCs for the biggest brands across the tech industry.
Foxconn does have one factory in Wuhan, China, which has been ground zero for the outbreak. However, the factory is responsible for less than 1 percent of the company’s total revenue. Other Foxconn manufacturing sites in the country resumed normal operations two weeks ago.
Liu added that in long-term, Foxconn is considering moving some of its factories out of China. But that has less to do with the coronavirus and more with President Trump’s trade war with Beijing, which resulted in tariffs on many Chinese-made electronics.
“Due to the US and China conflict, I think the capacity relocation definitely is a long-term goal to plan,” he said. How much Foxconn manufacturing capacity will be moved out of the country will also depend on whether Trump is re-elected US president, Liu added. “If he gets elected, I think the percentage (of manufacturing capacity) will be higher.”
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