- Tram Ho
On the evening of December 11 local time, Wistron’s iPhone factory in Karnataka, India, a Taiwanese technology company and one of Apple’s main iPhone factories, erupted. The cause is believed to be related to the problem of workers’ salaries.
After the incident, the police urgently went to the scene to maintain order, a total of 132 people were arrested, according to statistics, Wistron lost 4.37 billion rupees (about 1.4 trillion) and more than 20,000 iPhone products were stolen. There are currently no reports of casualties.
Wistron: The production line is not damaged, affecting the production capacity
It is understood that the Wistron factory is mainly responsible for the production of iPhone SE series mobile phones, IoT products and some medical devices. According to the report, Wistron’s iPhone production line in India also took part of orders for the iPhone 12 mini in the second half of this year.
Information from Wistron Taiwan said that only a few offices were destroyed, and the main production line and warehouse were not damaged. In addition, other factories in India and Kunshan, China can meet iPhone production capacity. As a result, the riots had a limited effect on Wistron’s cell phone factory business.
However, according to some other sources, the Wistron factory has been affected by the riot and the production line has not been able to resume operation. In addition to the Nalsapur factory, Wistron has two other factories in India that manufacture cell phones.
Wistron does not owe wages and is not responsible for the incident?
As for employee salaries, there has been some discrepancy between the Indian media report and the Wistron spokesperson. The Indian press citing sources asserted that the cause of the riots was due to the fact that workers were deducted from wages and delayed payment. However, Wistron stressed that the company is committed to complying with and implementing all local labor laws and regulations, and will fully support and cooperate with authorities in investigations. .
The official information they got was that Wistron had paid the labor service company wages, and the labor service company was slow to pay workers, said Karnataka’s director of the Industry Department, Shetar. The thing is, even though the labor service company is slow to pay, the actual wages don’t match the agreed salary. Based on the available information, the responsibility remains with Wistron, and Wistron has not made specific announcement about the problem of cutting wages of workers.
Wistron currently has 1,200 official employees in the factory, in addition Wistron has signed contracts with 6 labor service companies and hired about 8,900 people for the production of iPhone, the labor dispute has lasted for about 3 months.
Of course, there are also some assumptions that the riot in Wistron does not rule out “internal and external construction” from the labor service firms, or the Wistron Indian executives, people who attempt to gain illegal profits and knowingly incite facility employees to commence riot. Therefore, the truth of the matter probably still needs further investigation.
Following the incident, in response to the riot at India’s Wistron factory, India’s Karnataka Industry Ministry promised to provide the necessary protections for foreign companies to prevent the violence from recurring.
The consequences of the riots, investors will be wary
Not long ago, Indian officials raised their voice that Apple had penetrated India on a large scale and “nine suppliers have moved from China to India”. These “nine suppliers” actually refer to eight iPhone factories and one component factory, including Foxconn, Pegatron and Wistron.
Wistron started building the factory in India in 2015. It can be considered that it has been operating regularly in the Indian market for many years, but today it still faces the problem of being “smashed by the crowd, pillage”.
Judging from the wages of the workers exposed in the case, the wages of Indian workers have a certain cost advantage over Chinese, or even Vietnamese, workers. But it is worth thinking about whether those advantages are lost by uncertain events such as riot, or bring even more damage. At the same time, the imperfect supply chain system in India and ignorance of regulations by labor companies, are hard to cure diseases at the bottom of the manufacturing industry.
It should also be noted that, if the riots were not caused by spontaneous employees but an organized crime and arranged from the outside, it would be a devastating blow not only to Wistron but also to all. both foreign-invested manufacturing companies in India.
Source : Genk