Multiple publications include Fortune, Reuters, The Times of India, The Wall Street Journal and Apple Insider report that angry workers at the Wistron production facility located in southern India rioted on Saturday over working conditions.
Taiwan based Wistron is one of a number of contract manufacturers serving iPhone production needs and this production facility which is located on the outskirts of Bengaluru (Bangalore) has been operating since 2017. Supply Chain Matters highlighted for readers in May of 2017 indicating that the Wistron facility as being the milestone of the initial production of iPhones produced for the India market as part of the government’s local sourcing provisions for foreign based brands.
India has the potential to be one of the largest smartphone markets in the world, and addition to Wistron, Apple’s primary contract manufacturer Foxconn has been expanding its presence in the country, along with Apple contract manufacturer Pegatron. Apple rival Samsung Electronics is constructing a fairly large manufacturing facility near New Delhi.
Reports indicate that workers were upset over claims that they had not received pay and had been forced to work overtime. In its reporting, the Times of India indicated that the majority of workers at the facility, believed to be in excess of 2000, were involved in the incident. Indian television featured video throwing rocks, garnishing sticks and tossing furniture while setting fire to a Wistron sign. The report further indicated that many new iPhones were stolen from the facility.
In its reporting, Reuters indicated that: “Wistron filed a complaint accusing more than 5,000 contract workers and some 2,000-unknown people of destruction of property. It put the losses at 4.38 billion rupees ($60 million).”
Local authorities reportedly have detained upwards of 100 people and were conducting investigations of this incident. A minister for the state of Karnataka indicated that its investigation would focus on claims of underpayment of workers.
A Wistron spokesperson indicated to various publications that the company is “deeply shocked” by the unrest. An Apple spokesperson in the U.S. further indicated that the company has launched its own investigation and has personnel on the ground an en route to this facility. Noted was: “Apple is dedicated to ensuring everyone in our supply chain is treated with dignity and respect.”
Added Perspectives
This reported incident obviously has noteworthy implications for Apple as well as the government of India.
For Apple, this incident comes after the iPhone designer had recently cited Pegatron after discovering labor violations regarding a student workers’ program occurring at the contract manufacturer’s Shanghai and Kunshan production campuses in eastern China. According to a published Bloomberg report, Apple discovered that the Taiwanese based contract manufacturer allegedly misclassified student workers allowing them to work nights and overtime which is in violation of Apple’s Supplier Code of Conduct.
The government of India recently unveiled aggressive plans to incent high tech manufacturing firms to make an added presence in the country. Reportedly the country will provide financial subsidies to 16 manufacturers of mobile phones and electronic parts for either moving or increasing production activity within its borders. The companies reported include Samsung Electronics, Foxconn, Pegatron, and Wistron, the latter three being as indicated above assemblers of various Apple iPhones models. Further to be included in incentive offerings are indicated to be five India based smartphone makers and six domestic electronics component makers.
This appears to be a highly charged incident with many sides indicating conflicting accounts not to mention Wistron’s claims of upwards of $60 million in damage.
It will behoove all stakeholders to conduct a comprehensive but speedy investigation of claimed worker grievances and Wistron’s practices.
Apple itself can ill afford another high visibility incident of alleged violations of its supplier code of conduct involving contract manufacturing workers and we would be quite surprised if the smartphone maker were not very active in the investigation and causes of this incident.
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