Zhao Tuo, who used to earn 10,000 yuan per month, now only receives 4,000 yuan. As a result, he has chosen to leave the Pegatron factory in Shanghai, which is Apple’s iPhone assembly partner. After working there for some time, Tuo decided to take a car back to his hometown to “find a new way out.”
Tuo isn’t the only worker who has left the iPhone factory. A major “exit” is taking place as workers are no longer receiving high wages due to the shrinking scale of production. Workers’ income, which was 10,000 yuan (USD 1,454) this spring, has now dropped to 3,000-4,000 yuan (USD 436-581).
Tuo stated that the current salary at the iPhone factory is even lower than his income in his hometown. He said that working in the factory was like a gamble, as workers are not selected to work in any department and work more or less as assigned.
When he first arrived at Pegatron, he was assigned the position of warehouse manager, which was a relatively easy job. However, he was later transferred to the production line where Tuo works 10 hours a day, screwing screws as small as a grain of rice into the smartphone case. Each iPhone needs 2-8 screws, and during peak periods, he had to screw in 750 phones every day, or else his money would be deducted. Skilled workers can even assemble 1,200 machines. If he fulfills his quota and works overtime during peak months, Tuo can earn 10,000 yuan a month.
Like many other workers, he lives in a dormitory with 8 people per room. There are almost no expenses other than meals. “Social interaction is relatively low. Sometimes I have dinner with my roommates, that’s all,” Tuo said. With a decent income and little spending, he can save a fair amount of money to send back to his hometown.
However, after the first three months of the year, Zhao’s income dropped by 60%. If he continued to stay, his salary would decrease further. At its peak, the Pegatron plant in Shanghai required 80,000 workers, but now, the scale is significantly reduced.
Xu Li, 23, a worker at Shanghai Pegatron, said: “Of the factory’s eight assembly lines, five have stopped, leaving only three operations. Some have been shipped overseas in recent months.” Li said the current scene was in contrast to a few months ago. “At the beginning of the year, if you wanted to work at an iPhone assembly factory, you even had to pay a ‘pawn.’ Now the monthly salary is only about 3,000 yuan. Some of my colleagues have been moved to Kunshan and then quickly returned because there was no work,” Li said.
“Spring” in iPhone assembly plants in China is passing in the context of assembly workshops shrinking in size, low profits, and few orders. Some factories are looking to move production out of China. In late March, a Reuters source stated that Pegatron is planning to open a second facility in India, just six months after opening the first factory with an investment of 150 million USD.
Vietnam and India are considered a potential destination for Apple to gradually shift the iPhone assembly line out of China. According to the statistics of the Electronics and Mobile Association of India from April 2022 to February 2023, India’s smartphone export value has reached 9 billion USD, of which the iPhone accounted for more than 50%.
Apart from Pegatron, a number of other Apple partners are also facing a general bleak situation.
Foxconn’s recruitment partner said that since the beginning of the year, orders at Zhengzhou and Shenzhen factories have dropped sharply, and accordingly, the need to recruit has disappeared. A factory insider said that many orders have been shipped to Vietnam and India, and since last year, some managers have been transferred to the country. The layoffs are only a matter of time, according to IT Times and Sina.