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   seething in part because of Beijing’s heavy-handed Covid-19   
   approach, itself a concern for Apple and many other Western   
   companies. Three years after Covid-19 started circulating, China   
   is still trying to crush outbreaks with measures like   
   quarantines, as many other countries have returned to   
   prepandemic norms.   
      
   Protests in Chinese cities over the past week, during which some   
   demonstrators called for the ouster of President Xi Jinping,   
   suggested criticism over Covid-19 restrictions could build into   
   a larger movement against the government.   
      
   All this comes on top of more than five years of heightened U.S.-   
   China military and economic tensions under the Trump and Biden   
   administrations over China’s rapidly expanding military   
   footprint and U.S. tariffs on Chinese goods, among other   
   disputes.   
      
   Apple’s longer-term goal is to ship 40% to 45% of iPhones from   
   India, compared with a single-digit percentage currently,   
   according to Ming-chi Kuo, an analyst at TF International   
   Securities who follows the supply chain. Suppliers say Vietnam   
   is expected to shoulder more of the manufacturing for other   
   Apple products such as AirPods, smartwatches and laptops.   
      
   For now, consumers doing Christmas shopping are stuck with some   
   of the longest wait times for high-end iPhones in the product’s   
   15-year history, stretching until after Christmas. Apple issued   
   a rare mid-quarter warning in November that shipments of the Pro   
   models would be hurt by Covid-19 restrictions at the Zhengzhou   
   facility.   
      
   In November, as the worker protests in the facility grew, Apple   
   issued a statement assuring it was on the ground looking to   
   resolve the issue. “We are reviewing the situation and working   
   closely with Foxconn to ensure their employees’ concerns are   
   addressed,” a spokesman said at the time.   
      
   The risk of too much concentration in China has long been known   
   to Apple executives, yet for years they did little to lessen it.   
   China supplied a literate and diligent workforce, political   
   stability and a huge local market for Apple’s products.   
      
   Taiwan-based Foxconn, under founder Terry Gou, became an   
   essential link between Apple in California and the Chinese   
   assembly plants where iPhones get put together. Foxconn managers   
   share a language and cultural background with mainland workers.   
   Pegatron Corp., another Taiwan-based contractor, has played a   
   smaller but similar role.   
      
   And both the government in Beijing and local governments in   
   places such as Henan province, home to the Zhengzhou plant, have   
   enthusiastically supported Apple’s business, seeing it as an   
   engine of jobs and growth.   
      
   Even now, when ever-harsher anti-American rhetoric flows each   
   day from Beijing over issues such as Taiwan and human rights,   
   that backing remains strong.   
      
   People’s Daily, the mouthpiece of the Chinese Communist Party,   
   hailed the Apple production site in a Nov. 20 video, saying it   
   accounted directly or indirectly for more than a million local   
   jobs. Foxconn shipped about $32 billion in products overseas   
   from Zhengzhou in 2019, according to a Chinese government-linked   
   think tank. All told, the Foxconn group accounted for 3.9% of   
   China’s exports in 2021, according to the company.   
      
   “The government’s timely assistance…continuously provides a   
   sense of certainty for multinational companies like Apple, as   
   well as for the world’s supply chain,” the People’s Daily video   
   said.   
      
   Yet such words ring hollow to many U.S. businesses in light of   
   stringent anti-Covid measures by the government that have   
   hampered production and roused worker unrest. A survey by the   
   U.S.-China Business Council this year found American companies’   
   confidence in China has fallen to a record low, with about a   
   quarter of respondents saying they have at least temporarily   
   moved parts of their supply chain out of China over the past   
   year.   
      
   To keep operating during government Covid measures, the   
   Zhengzhou factory is among those compelled to adopt a system in   
   which workers stay on-site and contact with the outside world is   
   limited to the bare minimum to keep the goods flowing. Foxconn   
   has sealed smoking areas, switched off vending machines and   
   closed dining halls in favor of carryout meals that workers   
   bring back to their dormitories, often a half-hour walk away,   
   workers said.   
      
   Many have escaped, jumping fences and walking along empty   
   highways to get back to their hometowns. In November, the   
   pandemic policies and pay disputes further fueled workers’   
   grievances. Some clashed with police at the site and left   
   smashed glass doors.   
      
   Many of those abandoning the factory were young people who said   
   on social media that they decided wages equivalent to $5 or less   
   an hour weren’t enough to compensate for tedious production   
   work, exacerbated by Covid restrictions.   
      
   “It’s better for us to skate by at home than to be sucked dry by   
   capitalists,” one person who identified herself as a departed   
   Foxconn worker posted on her social-media account after the   
   protests.   
      
   Asked for comment, a Foxconn spokesman referred to earlier   
   statements in which the company blamed a computer error for some   
   of the pay issues raised by new hires. It said it guaranteed   
   recruits would be paid what was promised in recruitment ads. The   
   spokesman declined to comment further.   
      
   China’s Covid policy “has been an absolute gut punch to Apple’s   
   supply chain,” said Wedbush Securities analyst Daniel Ives.   
   “This last month in China has been the straw that broke the   
   camel’s back for Apple in China.”   
      
   Mr. Kuo, the supply-chain analyst, said iPhone shipments in the   
   fourth quarter of this year were likely to reach around 70   
   million to 75 million units, which he said was around 10 million   
   fewer than market projections before the Zhengzhou turmoil. The   
   top-of-the-line iPhone 14 Pro and Pro Max models have been   
   particularly hard-hit, he said.   
      
   Accounts vary about how many workers are missing from the   
   Zhengzhou factory, with estimates ranging from the thousands to   
   the tens of thousands. Mr. Kuo said it was running at only about   
   20% capacity in November, a figure expected to improve to 30% to   
   40% in December. One positive sign came Wednesday, when the   
   local government in Zhengzhou lifted lockdown restrictions.   
      
   One Foxconn manager said hundreds of workers were mobilized to   
   move machinery and components by truck and plane nearly 1,000   
   miles from Zhengzhou in central China to Shenzhen in the south,   
   where Foxconn has its other main factories in China. The   
   Shenzhen factories have made up some, but not all, of the   
   production gap.   
      
   Meanwhile, Foxconn is offering money to get workers to come back   
   and stay for a while. One of its offers is a bonus of up to   
   $1,800 for January to full-time workers in Zhengzhou who joined   
   at the start of November or earlier. Those who wanted to quit   
   have gotten $1,400.   
      
   India and Vietnam have their own challenges.   
      
   Dan Panzica, a former Foxconn executive who now advises   
   companies on supply-chain issues, said Vietnam’s manufacturing   
   was growing quickly but was short of workers. The country has   
   just under 100 million people, less than a 10th of China’s   
   population. It can handle 60,000-person manufacturing sites but   
   not places such as Zhengzhou that reach into the hundreds of   
   thousands, he said.   
      
   “They’re not doing high-end phones in India and Vietnam,” said   
   Mr. Panzica. “No other places can do them.”   
      
   India has a population nearly the size of China’s but not the   
   same level of governmental coordination. Apple has found it hard   
      
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