Apple Supplier Foxlink Unlikely To Resume Full India Operations For Two Months

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

The facility in the Chittoor district of India's Andhra Pradesh state, where Foxlink makes charging cables for iPhones, was engulfed in a massive fire on Monday that led part of the building to collapse to the ground. There were no casualties.

The source with direct knowledge said that Foxlink operates a total of 10 assembly lines in two separate facilities at the plant in Andhra, of which four were completely damaged and unlikely to resume operations for two months.

Production at the remaining six assembly lines is expected to resume later this week. Even though they were unaffected by the fire incident, they cannot be operated currently due to damage to IT servers.

A second source familiar with the developments said that 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 being investigated, the first source added.

The incident is the latest problem to hit Apple 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 facility of Apple contract manufacturer Foxconn in 2021 due to food poisoning among workers, and a Wistron India plant was in 2020 hit by worker unrest over non-payment of wages.

IMPACT ON BUSINESS

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

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

"The fire became uncontrollable," one worker said, declining to be named.

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 was an estimated loss of $12 million at the factory. Employees said the Foxlink factory makes charging cables used in iPhones, but it was not immediately clear if Apple has other suppliers for the cables in India.

Cupertino, California-based Apple has bet big on India since it began assembling iPhones in the country in 2017 via Wistron and later with Foxconn, in line with the Indian government's push for local manufacturing.