As if there was a chance Friday's explosion wouldn't impact Foxconn’s bottom line for iPad 2 shipments, upstream component suppliers are now signaling that the Chengdu site shipped 25-30% of the total iPad 2 devices shipped in April, suggesting that availability will undoubtedly be affected with the facility now out of commission.
As reported earlier, production is now suspended at Foxconn’s factory in Chengdu City, in western China, where an explosion of combustible dust left three workers dead, and 15 others injured on Friday, May 20.
The facility had only recently begun production of the Apple iPad 2, and is believed to be responsible for 25-30% of the units shipped last month, according to Chinese sources cited by industry publication DigiTimes.
Inevitable concerns about what the impact will be on the output schedule are now raised.
Neither Foxconn, nor Apple have said anything about the iPad 2 supply status, even though both companies issued formal statements in which they expressed their condolences to the families of those affected by the explosion.
Foxconn also said it would foot the bill for any necessary medical intervention on those injured during the explosion, and has started an investigation to determine the ‘root’ cause of the accident.
Initial findings suggest “the accident was caused by an explosion of combustible dust in a duct,” Foxconn officials said.
Foxconn’s plants in Shenzhen (southern China), remain the key manufacturing units for Apple’s iPad 2, the Chinese sources report.
Apple’s online stores are now showing an increase in shipping times for the tablet computer, while Foxconn's unaffected Shenzhen facilities have been ordered to increase production, according to the same sources.
Monthly output is expected to increase from 1.8-2 million in the first quarter to 4-5 million units a month in the second quarter.
With or without the Chengdu site reinstated, Foxconn is poised to deliver 9-10 million units in the second half of 2011, the sources said.
Such news undoubtedly makes some people wonder: will Foxconn see another wave of suicides as the company is planning to push workers even harder?
Following numerous reports of suicides at various Foxconn’s establishments over the past two years, reporters trying to shed more light on the work conditions at Foxconn have painted a gloomy picture about the way employees were being treated, the long shifts, poor compensation etc.
The company’s CEO, Terry Gou, has gone to great lengths to stress this was not the case at all, yet the general idea that Foxconn workers are constantly unhappy looms still.