Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Foxconn aims to resume half of output in virus-hit China by month-end - source

Published 12/02/2020, 05:45
Updated 12/02/2020, 05:45
© Reuters. FILE PHOTO: The logo of Foxconn, the trading name of Hon Hai Precision Industry, is seen on top of the company's building in Taipei

© Reuters. FILE PHOTO: The logo of Foxconn, the trading name of Hon Hai Precision Industry, is seen on top of the company's building in Taipei

By Yimou Lee

TAIPEI (Reuters) - Taiwan's Foxconn (TW:2317) hopes to resume half of its production in China by month-end, a source told Reuters on Wednesday, as the supplier to tech giant Apple (O:AAPL) and others reopens plants shut over a coronavirus outbreak.

The world's largest contract electronics maker also aims to resume 80% of production in China in March, added the source, who has direct knowledge of the matter, citing internal targets set by Chairman Liu Young-Way.

Foxconn's reopenings after the Lunar New Year holiday were delayed by the rapid spread of the virus in China, which has killed more than 1,100 people, as the World Health Organization warned against a global threat potentially worse than terrorism.

"Chairman Liu hopes by end of February the production could reach 50%," said the person, who declined to be identified in the absence of authorisation to speak publicly.

"Shipments will be affected, but it's too early to give an exact number. We might still have a chance to make it with overtime, but we also need to monitor consumer sentiment to come for the end products," the source added.

The reference was to electronics, including smartphones.

Foxconn did not immediately respond to email and telephone calls to seek comment.

Foxconn got the green light this week to reopen major plants in China, and its plant in the eastern city of Kunshan was also approved on Tuesday to resume production, an internal document reviewed by Reuters showed.

But just about a tenth of the workforce had returned to two key plants in southern Shenzhen and central Zhengzhou as of Monday, a source told Reuters.

The two plants make up the bulk of Foxconn's assembly lines for Apple's iPhones and further delays to production after the enforced closures could hit global shipments.

Apple estimated first-quarter revenue in a wider range than usual to factor in the virus uncertainty.

On Monday, Foxconn reported a drop of 12% in revenue in January from a year ago, to T$364.6 billion ($12 billion). It did not give details.

Shares of Foxconn, formally Hon Hai Precision Industry Co Ltd, gained 3.1% on Wednesday, outperforming a rise of 0.9% in the benchmark index (TWII).

© Reuters. FILE PHOTO: The logo of Foxconn, the trading name of Hon Hai Precision Industry, is seen on top of the company's building in Taipei

The shares have lost more than 7% since the market reopened after the holiday break.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.