Apple Inc (NASDAQ:AAPL) supplier Foxconn and many other Chinese factories were shut following a Covid-19 outbreak in Shenzhen, which caused authorities to implement a lockdown.
The two plants are big production hubs for the US tech giant and workers said the latest iPhone 13 was being worked on.
Although Foxconn adjusted production at other plants to “minimise the potential impact,” it said.
The outbreak, which was in the city of 17.5mln people, was the worst in the country since the start of the pandemic.
“The Covid situation in China has deteriorated at an alarming pace over the past week,” said Ting Lu, Nomura chief China economist.
“With the much worsening pandemic and Beijing’s resolution in maintaining its [zero covid strategy], we believe China’s ‘around 5.5%’ GDP growth target this year is becoming increasingly unrealistic,” Ting Lu added.
Factories were closed, people were told to stay home and public transport and restaurants shut following over 5,000 new cases being reported in China over the weekend.
The cause is unknown but Hong Kong was blamed as they are experiencing a surge in cases, which is piling pressure on hospitals and morgues, the Financial Time said.
This lockdown in the technology and manufacturing hub that borders Hong Kong is expected to last six days and contribute to global supply chain problems.
Meanwhile, Chinese markets slumped on Monday morning, with the Hang Seng Tech index of large technology stocks down approximately 11% and China’s CSI 300 index falling 3.1%.