Coronavirus: Apple Supplier Foxconn Says Plans in Place to Meet Production Obligations After Outbreak

Apple supplier Foxconn said it could continue to meet all manufacturing obligations in the wake of a coronavirus outbreak in China even as the iPhone maker flagged uncertainty created by the disease. A new coronavirus has killed 132 in China and affected nearly 6,000 people, with several other countries reporting cases as well. China extended the Lunar New year Holiday by three days to February 2 to contain spread of the virus.

"We do not comment on our specific production practices, but we can confirm that we have measures in place to ensure that we can continue to meet all global manufacturing obligations," Foxconn, formally known as Hon Hai Precision Industry, said in a statement on Tuesday.

Foxconn, which has a big facility in Wuhan, the epicentre of the virus outbreak, said its plants in China were following holiday schedules and would continue to do so until all businesses have resumed standard operating hours.

The outbreak has led countries including the United States to advise against all but necessary travel to China, forced food chains such as Starbucks to close stores and airlines to cancel flights.

Apple, which reported holiday quarter sales and profit above Wall Street expectations on Tuesday, offered a wider-than-normal earnings outlook for the March quarter because of the uncertainty created by the coronavirus.

"The situation is emerging, and we're still gathering lots of data points and monitoring it very closely," Apple Chief Executive Tim Cook told Reuters.

Apple has suppliers in the Wuhan area, but has alternatives, Cook said.

After the Lunar New Year holiday, factories outside the Wuhan area will not reopen until February 10, Cook said, but Apple built the delayed restart into its wider revenue forecast.

Taiwan's TSMC, the world's largest contract chipmaker which has factories in China's Shanghai and Nanjing, told Reuters its operations had not been affected. The company has asked staff who had visited Hubei within the last 14 days to stay at home and monitor their health.

© Thomson Reuters 2020