Apple provider Foxlink unlikely to resume operations in India for 2 months after fire

Apple supplier Foxlink’s factory in southern India is unlikely to resume full operations for two months after a fire, raising concerns about disruptions to the iPhone maker’s supply chain, a source with direct knowledge told Reuters on Tuesday.

The facility in Chittoor district, in the Indian state of Andhra Pradesh, where Foxlink manufactures charging cables for iPhone models, was engulfed in a massive fire on Monday that led to the collapse of part of the building. There were no casualties.

The source with direct knowledge said Foxlink operates a total of 10 assembly lines in two separate facilities at the Andhra factory, four of which were completely damaged and are not expected to resume operations for two months.

Production at the remaining six assembly lines is expected to resume later this week. Although they were not affected by the fire, they cannot currently be operated due to damage to the computer servers.

A second source familiar with the developments said Foxlink was a key supplier for Apple in India, and “there could be potential supply chain disruptions for iPhones made in India or shipped from India.”

Apple and Foxlink did not immediately respond to requests for comment. The cause of the incident is still under investigation, the first source added.

The incident is the latest problem to hit Apple’s suppliers in India, from where it is increasingly ramping up manufacturing and exports. Apple has 11 suppliers in the country.

Production was hit at a factory by Apple contractor Foxconn in 2021 due to food poisoning among workers, and a factory in Wistron India was hit in 2020 by worker unrest over non-payment salaries.

Business impact

Reuters visited the Foxlink site on Tuesday where part of the building was completely charred and smoke residue was still billowing from some parts.

Many workers gathered outside the facility, some worried about the status of their contract jobs. They told Reuters the fire started during lunch break on Monday and some air conditioners exploded as the fire spread.

“The fire got out of control,” said a worker, on condition of anonymity.

Foxlink management is currently reviewing the situation and expects to have a clearer picture of the impact on the business over the next two days, the first source added.

A police official told Reuters on Monday there had been an estimated loss of $12 million at the plant. Employees said the Foxlink factory manufactures charging cables used in iPhones, but it was not immediately clear if Apple had other suppliers for the cables in India.

Apple, based in Cupertino, Calif., has been betting big on India since it began assembling iPhones in the country in 2017 via Wistron and later Foxconn, in line with Indian government pressure for local manufacturing. .

© Thomson Reuters 2023