Foxconn ends months-long ‘closed loop’ at China’s largest iPhone assembly plant

Taiwanese tech giant Foxconn has ended a months-long “closed-loop” system at the world’s largest iPhone factory in central China, citing Beijing’s nationwide easing of zero-Covid regulations.

Earlier this week, the Chinese government rolled back most mass testing and lockdown requirements to speed up the return to normal life, dramatically easing three years of restrictions that have weighed on its economy and weary its people.

Foxconn’s facility in central Zhengzhou was blocked for 56 days, with workers only allowed to travel between their dormitories and the factory on shuttles after cases were discovered in October.

In mid-November, violent protests by new recruits erupted over wages and conditions, with hundreds protesting and some clashing with riot police and health workers.

On Thursday, the company announced it was ending the closed-loop system.

“In light of the … further lifting of epidemic control measures in China, the company requires employees to show a negative test result within 48 hours in order to return to work,” reads a notice posted on the account Thursday. official WeChat from the main campus of Foxconn in Zhengzhou, Henan province.

The company added that its shuttles had resumed service and urged employees who had not participated in the closed loop to return to work “as soon as possible”.

Other official WeChat accounts of agencies hiring for Foxconn also announced that the “closed loop is lifted”.

Foxconn, also known by its official name Hon Hai Precision Industry, is the world’s largest contract electronics manufacturer and assembles gadgets for many international brands.

Most of its factories are in China, with the largest being in Zhengzhou, dubbed “the city of the iPhone”.

Lockdowns were imposed on the city last month as part of Beijing’s zero Covid policy after a spike in infections.

The prolonged factory disruption and protests have had a huge impact on Foxconn’s hiring practices and have shaken the stability of the supply chain, which Beijing attaches great importance to.

A letter sent by Foxconn founder Terry Gou warning Chinese leaders of zero-Covid damage to supply chains has helped government advisers argue for an end to the policy, The Wall Street Journal reported on Thursday. citing people familiar with the matter.

Foxconn’s reported revenue last month fell 11.4% year-on-year and 29% from October.

It announced earlier that it was downgrading its outlook for the final quarter. Some analysts have predicted that sales could fall by up to 20%.

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