Zhengzhou city in China has lifted a five-day Covid lockdown which is much needed for Apple as the city houses world’s largest iPhone Factory-Foxconn.
The city last Friday locked down its urban districts as Covid cases surged.
Foxconn factory is not among the urban districts; analysts however say it would have affected the company’s efforts to recover production time lost during a revolt by the employees.
The protests broke out in the Foxconn factory after the newly hired staff said management had reneged on their promises. The workers, who clashed with security officers, were eventually offered cash to quit and leave.
Also Read: China: Prolonged Poor Economic Performance as Covid Restriction Protests Persist
Foxconn houses about 200,000 workers churning out products for Apple (AAPL), including the iPhone 14 Pro and 14 Pro Max.
“This is some good news in a dark storm for Cupertino. There is a lot of heavy lifting ahead for Apple to ramp back up the factories.” Said Daniel Ives, managing director of equity research at Wedbush Securities.
According to Ives, the disruptions at Foxconn were costing Apple approximately $1 billion per week due to low iPhone sales.
Analysts said Foxconn’s production woes will speed up the pace of supply chain diversification away from China to countries like India.