Fire at Apple Supplier Pegatron's India Facility Disrupts iPhone Assembly
Updated: Dec 30, 2023
[Edited] Pegatron, a supplier for Apple, has instructed its factory workers not to report for work on Tuesday, marking the second consecutive day of halted iPhone assembly at its south India plant following a fire incident on Sunday, according to three sources familiar with the matter.
The sources, who have direct knowledge of the situation, stated that the workers were not given a reason for the directive. Pegatron had already canceled all shifts on Monday at the factory near Chennai in Tamil Nadu state after the fire incident, as confirmed by two sources.
Pegatron previously informed Reuters in a statement on Monday that there was a "spark incident" at the facility, which is currently under control. The company added that the incident does not have a significant financial or operational impact.
While the plant has a production capacity of approximately 26,000 iPhones per day, it has been assembling around 8,000-12,000 iPhones per day in recent months, according to an industry source. Pegatron declined to comment on the production estimate, and Apple did not respond to a request for comment.
Local authorities reported that multiple fire engines from various stations were deployed to extinguish the fire, which took nearly five hours. Pegatron stated, "There are no injuries, no casualties, nor damage to other assets. The cause of the accident is currently under investigation by the relevant authority." A police official confirmed that an inquiry is underway, describing the incident as minor.
Late on Monday, local media reported that the fire resulted in black smoke covering the nearby area, with footage showing security guards attempting to disperse a crowd that had gathered near the facility's entrance.
Pegatron accounts for 10% of Apple's iPhone production in India, according to research firm Counterpoint. The firm estimates that Apple will sell over nine million iPhones in India this year.
Since commencing iPhone assembly in India in 2017 through Wistron and later Foxconn, Apple has made significant investments in the country, in line with the Indian government's push for local manufacturing.
Pegatron, which began iPhone assembly in India in September last year, is also in talks to establish a second contract facility for Apple near the existing one in Tamil Nadu.
This incident is the latest challenge faced by one of Apple's 14 suppliers in India. Earlier this year, production was affected at a Foxconn facility due to food poisoning among workers, while a Wistron plant experienced worker unrest in 2020 over non-payment of wages. In February, a fire at a south Indian facility of Foxlink, responsible for iPhone charging cables, forced a production halt.
Pegatron, an Apple supplier, has halted operations at its India plant for a second day following a fire incident.
The workers were not given a reason for the directive.
Pegatron stated that the incident does not have a significant financial or operational impact.