Huawei, Foxconn, and Other Chinese Companies Reportedly Advised to Go Under ‘Closed Loop’ in Shenzhen

Huawei, Foxconn, and Other Chinese Companies Reportedly Advised to Go Under ‘Closed Loop’ in Shenzhen

Tech and manufacturing workers will once again be barred from leaving their employers’ facilities for a period of time in a Chinese city, in an attempt to keep production going, while stymying the spread of COVID-19, according to a report from Bloomberg News. The newest round of lockdowns is in Shenzhen, where the government is making some of its largest companies enter a “closed loop” in response to the most recent spate of COVID-19 cases. Under the strategy, employees’ movements and contacts with people beyond their workplaces are significantly restricted.

The restrictions seem to apply to many of the city’s 100 biggest corporations, including tech giants like telecom company Huawei, iPhone maker Foxconn, and chip manufacturer SMIC. Gizmodo couldn’t immediately verify the Shenzhen government notice referenced by Bloomberg. Though South China Morning Post similarly reported that a closed loop strategy began on Sunday in Shenzhen, and will continue for the next seven days, according to unnamed “industry sources with knowledge of the local government directive.”

From the China Morning Post:

The move to a closed-loop operation mode, which involves control measures such as locking workers within a compound and conducting daily nucleic acid testing, remains the go-to strategy for mainland factories to keep production on track, while reducing the risk of spreading the coronavirus.

The outlet further wrote that the strategy is only being implemented at company campuses with worker housing and manufacturing facilities on-site. However, reports of previous lockdowns described workers being made to sleep on factory floors. This is not the first time that tech and manufacturing employees in China have been barred from leaving their workplaces in recent months. Tesla’s Shanghai factory, along with other manufacturers in Shanghai, operated under a closed-loop in April.

Huawei, SMIC, and Shenzhen officials did not immediately respond to Gizmodo’s request for comment. In an emailed statement, Foxconn Technology Group said, “operations are as normal at Foxconn’s Shenzhen campus. The government’s epidemic prevention policy is being followed to ensure both the health and safety of employees and optimal work of production lines.”

Shenzhen is a technology and manufacturing hub. The city of almost 12.6 million people is home to numerous headquarters, factories, and facilities from well-known, national and international tech corporations like drone maker DJI, social media company Tencet, and ZTE Corp. The city, often compared to California’s Silicon Valley, reported 21 new COVID cases on Monday according to the local health commission, and 19 total cases on Sunday. The entire Chinese mainland reported 966 new virus cases on Sunday.