Hundreds of workers have rioted at Foxconn’s flagship iPhone plant in China, smashing equipment and clashing with hazmat-clad police over pay and living conditions.
The unrest broke out at the plant in Zhengzhou after workers marched out of their dormitories in a rare show of open dissent.
In videos shared across Chinese social media, staff can be heard chanting “crackdown Foxconn”, “we want to go home” and “give us our pay!”.
In one clip, a man is shown with a bloodied face, while someone off-camera says: “They’re hitting people, hitting people. Do they have a conscience?”
The trigger for the protests appeared to be a plan to deny bonus payments promised to new workers along with poor living conditions at the plant, many of the demonstrators said on livestream feeds.
The Zhengzhou plant, which employs about 200,000 people, recently saw a surge in Covid cases, leading it to shutter the complex and operate in a “closed loop” bubble in an attempt to prevent the virus from spreading.
Under closed-loop operations, staff live and work on-site isolated from the wider world.
Hundreds of employees attempted to flee on foot to escape the lockdown, many scaling fences and walking miles to return home. To keep the plant running, Foxconn recruited new employees with the promise that they would be paid large bonuses.
In the videos circulating on Chinese social media, workers vented about how they were never sure if they were going to get meals while in quarantine. “Foxconn never treats humans as humans,” said one person.
Some workers complained they were forced to share dormitories with colleagues who had tested positive for coronavirus. Others claimed their bonuses had been cut from 3,000 yuan to 30 yuan, according to AFP.
“It’s now evident that closed-loop production in Foxconn only helps in preventing Covid from spreading to the city, but does nothing for the workers in the factory,” said Aiden Chau of China Labour Bulletin, a Hong Kong-based advocacy group.
Foxconn said it had fulfilled its payment contracts and insisted reports staff were asked to share dormitories with those suffering from Covid-19 were “untrue”.
It added: “Regarding violent behaviours, the company will continue to communicate with employees and the government to prevent similar incidents from happening again.”
Li Qiang, founder of China Labour Watch, claims the unrest is “the result of Apple’s need for production without regard for workers’ demands”.
Foxconn, which is based in Taiwan but has factories on mainland China and in India, is Apple’s biggest iPhone maker, accounting for 70pc of iPhone shipments globally.
iPhones remain the driver behind the vast majority of the tech giant’s huge profits. It sold more than $200bn worth of iPhones over the last year, representing more than half its total revenues. The company is valued at $2.4 trillion (£2 trillion) and reported profit after tax just shy of $100bn in the year to September, according to its most recent financial results.
Apple has so far refused to comment on the protests at the plant and did not answer questions from The Telegraph on Wednesday.
The curbs and discontent have already hit production. Reuters last month reported that iPhone output at the Zhengzhou factory could slump by as much as 30pc in November due to Covid restrictions.
Apple said earlier in November: “The facility is currently operating at significantly reduced capacity. Customers will experience longer wait times to receive their new products.”
“We are working closely with our supplier to return to normal production levels while ensuring the health and safety of every worker.”
As well as iPhone delays, the unrest has proven embarrassing for Apple’s push to clean up its supply chain.
“Like we’ve already seen in Russia, companies that do business with despotic regimes face huge risks – both to their reputations and their supply chains,” says Vicky Wyatt, SumOfUs campaign director.
In its latest annual supply chain report, Sabih Khan, Apple’s head of global supply chain, praised the company’s “high standards for rights protections and health and safety” and its efforts to “raise standards across industries and support people across our global supply chain”.
Apple said in its 2021 report that it had conducted 1,177 assessments of companies in its supply chain and said it blocked 9pc of pitches from potential suppliers over their record on workplace rights and safety.
Working conditions at Foxconn have come in for scrutiny before. At its plant in Shenzhen, China, a spate of worker suicides in 2010 focused international attention on conditions at its factories and prompted Apple to demand additional audits at the company.
Foxconn did not respond to a request for comment. It previously defended its measures as part of a “protracted battle” against coronavirus. A spokesman said last month: “The welfare of our workforce is a priority for the group’s operations.”
Technology analysts say they expect further disruption to Apple’s supply chain. UBS says waiting times for new iPhones have “ticked higher” again due to “persistent Covid lockdowns in China”. It expects some models to be unavailable until January.
“This latest zero Covid situation is an absolute body blow for Apple in its most important holiday quarter,” says Dan Ives, of Wedbush Securities.
“If Zhengzhou remains at lower capacity in the next few weeks and continues to see the unrest build with workers, this would cause clear major iPhone Pro shortages into the all-important Christmas time period especially in the US.”
If China continues its harsh coronavirus policies, despite widespread vaccinations, companies could reconsider their operations. The lockdowns have led to a stalled recovery for Beijing. The IMF estimates China’s economy will grow 3.2pc in 2022, down from 8.1pc last year.
Teng Biao, a Chinese human rights lawyer in exile in the US, says the pressure of constant lockdowns is weighing on Western companies that have relied on China for overseas labour. “More factories and capital will leave China,” he says.
Apple is already planning to shift some factory operations to India and has begun manufacturing some devices in Vietnam.
“The zero Covid policy is a political task that will cause huge losses to the Chinese economy,” says Teng. “People will become increasingly pessimistic about China’s economic prospects.”
For Apple, the reputational cost could be much greater than iPhone delays.
“The fact is customers don’t want iPhones made with human misery,” says Wyatt.
“If Apple wants to protect its brand it needs to diversify to countries with greater respect for workers’ rights.”
Source: https://finance.yahoo.com/news/apple-iphone-workshop-descended-rioting-174242998.html