Shanghai’s Workers Sleep on Floors to Keep Factories Going Amid Covid-19 Lockdown
By Yoko Kubota, Apr. 1, 2022, WSJ
Shanghai’s Covid-19 lockdown closed many factories in the
manufacturing hub. Some of its biggest plants have kept
humming by adopting a bubblelike environment, with some
workers saying they slept on the factory floor.
The municipal government in the city has allowed some companies
to maintain operations by adopting closed-loop systems similar
to the one China used to host the Winter Olympics, with staff
working, living and staying within a restricted area.
The strategy is part of frantic efforts by officials and
companies to balance disparate goals: curbing the growing
outbreak under stringent Covid-control policies, while keeping
production going to limit economic damage and global supply-chain
fallout.
Among the companies staying open is China’s biggest state-owned
auto maker, SAIC Motor Corp., which is based in the city. Since
Shanghai’s outbreak worsened in mid-March, SAIC has been operating
several factories under a closed loop, the company said.
Assembly workers of many Chinese manufacturing giants often live
in dormitories on or near factory campuses with amenities such
as canteens and stores. The community-style setup offers an
advantage to companies when it comes to creating bubble environments
that would be near-impossible in other parts of the world, though
it comes with burdens on workers who must be confined there for days,
if not weeks.
At SAIC, many workers who lived outside the factory campus were
brought inside, workers and people familiar with the matter said.
Some of the workers said they initially had to sleep on air
mattresses on the floor near assembly lines before being moved
to the gym of a nearby hotel where hundreds of tents were set up.
Others have been sleeping in the corner of a warehouse, while some
have been placed in nearby hotels, with up to five in a room, they said.
On day one of the bubble, workers received a package prepared by
SAIC called a “personal 10-piece set,” which included a quilt,
towel, air mattress, sleeping bag, underwear and socks, they said.
Workers are tested regularly for Covid-19 and can’t leave the
closed loop unless there is an emergency. Many workers have been
inside for two weeks already and it is unclear how long this setup
will last—some workers said they have heard that the campus won’t
open up for at least around another week. As of Friday, the west
and north side of Shanghai went into lockdown, the second half of
a two-part lockdown for the city that kicked off Monday. Covid-19
cases in the city hit a record high this week with almost 6,000
infections announced on Wednesday, though on Friday, the case
numbers declined to around 4,500.
In Shanghai, Volkswagen AG halted production at its plants
starting Friday for five days, a spokeswoman said. Before this,
it had mostly kept them online, some days during which it operated
them under a closed-loop system, according to a post on WeChat by
the Volkswagen-SAIC joint venture. Tesla Inc. has halted production
since Monday.
In the chip sector, Taiwan Semiconductor Manufacturing Co. is
operating its factory under the bubblelike system, according to
a person familiar with the matter. A TSMC spokeswoman said there
has been no impact on its production there.
China’s attempt to contain Covid-19 flare-ups has prompted
major industrial hubs such as Shanghai, Changchun and Shenzhen
to shut down, and the moves have taken a toll on the nation’s
economy. The official purchasing managers index for the
manufacturing sector in March showed that activity is shrinking
after four straight months of expansion.
Manufacturers are also dealing with an increasingly complicated
logistics situation to ship their finished goods and secure parts.
SAIC has experienced delays delivering some autos, people familiar
with the matter said. The lockdown has ensnared truckers, warehouses
and other critical links in supply chains.
Some suppliers to SAIC outside of Shanghai have been dealing
with local outbreaks. SAIC has set up a system in which it
arranges shipments of key parts if it becomes aware that their
suppliers could face factory suspension orders from local
authorities, a person familiar said.
SAIC is one of the biggest employers in Shanghai and the local
joint-venture partner for General Motors Co. and Volkswagen.
SAIC has passenger-car and engine factories in Lingang, a
manufacturing zone in Shanghai’s southeast. The plant produces
around 320,000 vehicles a year, including cars under SAIC’s Roewe
and MG brands, with some for export.
The half-square-mile campus, which contains canteens, basketball
courts and stores, was subject to Shanghai’s four-day phase-one
lockdown that was lifted early Friday, though parts remain tightly restricted. A worker at the Lingang car factory with the surname
Xu said he started living inside the closed loop on March 16. On
the first night, Mr. Xu slept by the production line, placing
cardboard and quilts on the floor. The following night, he slept
on an air mattress there. Some colleagues slept side by side in
big conference rooms, he said.
From the third day, he and his colleagues have been based at a
gym of a nearby hotel, from where they have been shuttled in and
out of the factory campus by bus for the past two weeks. At the
gym, some 200 male workers live in tents. At night, it is filled
with the sound of colleagues snoring and not the greatest of smells,
Xu said.
Around 5,000 people like Xu are now staying on Lingang campus—they
also include personnel from suppliers and logistics partners,
according to people familiar with the matter. Workers said they
receive meals in boxes.
The two weeks in the closed loop have been “very boring,” said Xu.
After work, he spends his time chatting with his family and friends
online, he said.
To keep workers on site, SAIC is offering extra money, with some
receiving double pay for the hours they work, people familiar with
the matter said. To lighten the mood, a birthday party was organized
for those born in March, according to a company letter to the Lingang workers, posted on the campus’s official WeChat account.
https://www.wsj.com/articles/shanghais-workers-sleep-on-floors-to-keep-factories-going-amid-covid-lockdown-11648809322
Shanghai’s Workers Sleep on Floors to Keep Factories Going Amid Covid-19 Lockdown
By Yoko Kubota, Apr. 1, 2022, WSJ
Shanghai’s Covid-19 lockdown closed many factories in the
manufacturing hub. Some of its biggest plants have kept
humming by adopting a bubblelike environment, with some
workers saying they slept on the factory floor.
The municipal government in the city has allowed some companies
to maintain operations by adopting closed-loop systems similar
to the one China used to host the Winter Olympics, with staff
working, living and staying within a restricted area.
The strategy is part of frantic efforts by officials and
companies to balance disparate goals: curbing the growing
outbreak under stringent Covid-control policies, while keeping
production going to limit economic damage and global supply-chain
fallout.
Among the companies staying open is China’s biggest state-owned
auto maker, SAIC Motor Corp., which is based in the city. Since
Shanghai’s outbreak worsened in mid-March, SAIC has been operating
several factories under a closed loop, the company said.
Assembly workers of many Chinese manufacturing giants often live
in dormitories on or near factory campuses with amenities such
as canteens and stores. The community-style setup offers an
advantage to companies when it comes to creating bubble environments
that would be near-impossible in other parts of the world, though
it comes with burdens on workers who must be confined there for days,
if not weeks.
At SAIC, many workers who lived outside the factory campus were
brought inside, workers and people familiar with the matter said.
Some of the workers said they initially had to sleep on air
mattresses on the floor near assembly lines before being moved
to the gym of a nearby hotel where hundreds of tents were set up.
Others have been sleeping in the corner of a warehouse, while some
have been placed in nearby hotels, with up to five in a room, they said.
On day one of the bubble, workers received a package prepared by
SAIC called a “personal 10-piece set,” which included a quilt,
towel, air mattress, sleeping bag, underwear and socks, they said.
Workers are tested regularly for Covid-19 and can’t leave the
closed loop unless there is an emergency. Many workers have been
inside for two weeks already and it is unclear how long this setup
will last—some workers said they have heard that the campus won’t
open up for at least around another week. As of Friday, the west
and north side of Shanghai went into lockdown, the second half of
a two-part lockdown for the city that kicked off Monday. Covid-19
cases in the city hit a record high this week with almost 6,000
infections announced on Wednesday, though on Friday, the case
numbers declined to around 4,500.
In Shanghai, Volkswagen AG halted production at its plants
starting Friday for five days, a spokeswoman said. Before this,
it had mostly kept them online, some days during which it operated
them under a closed-loop system, according to a post on WeChat by
the Volkswagen-SAIC joint venture. Tesla Inc. has halted production
since Monday.
In the chip sector, Taiwan Semiconductor Manufacturing Co. is
operating its factory under the bubblelike system, according to
a person familiar with the matter. A TSMC spokeswoman said there
has been no impact on its production there.
China’s attempt to contain Covid-19 flare-ups has prompted
major industrial hubs such as Shanghai, Changchun and Shenzhen
to shut down, and the moves have taken a toll on the nation’s
economy. The official purchasing managers index for the
manufacturing sector in March showed that activity is shrinking
after four straight months of expansion.
Manufacturers are also dealing with an increasingly complicated
logistics situation to ship their finished goods and secure parts.
SAIC has experienced delays delivering some autos, people familiar
with the matter said. The lockdown has ensnared truckers, warehouses
and other critical links in supply chains.
Some suppliers to SAIC outside of Shanghai have been dealing
with local outbreaks. SAIC has set up a system in which it
arranges shipments of key parts if it becomes aware that their
suppliers could face factory suspension orders from local
authorities, a person familiar said.
SAIC is one of the biggest employers in Shanghai and the local
joint-venture partner for General Motors Co. and Volkswagen.
SAIC has passenger-car and engine factories in Lingang, a
manufacturing zone in Shanghai’s southeast. The plant produces
around 320,000 vehicles a year, including cars under SAIC’s Roewe
and MG brands, with some for export.
The half-square-mile campus, which contains canteens, basketball
courts and stores, was subject to Shanghai’s four-day phase-one
lockdown that was lifted early Friday, though parts remain tightly restricted. A worker at the Lingang car factory with the surname
Xu said he started living inside the closed loop on March 16. On
the first night, Mr. Xu slept by the production line, placing
cardboard and quilts on the floor. The following night, he slept
on an air mattress there. Some colleagues slept side by side in
big conference rooms, he said.
From the third day, he and his colleagues have been based at a
gym of a nearby hotel, from where they have been shuttled in and
out of the factory campus by bus for the past two weeks. At the
gym, some 200 male workers live in tents. At night, it is filled
with the sound of colleagues snoring and not the greatest of smells,
Xu said.
Around 5,000 people like Xu are now staying on Lingang campus—they
also include personnel from suppliers and logistics partners,
according to people familiar with the matter. Workers said they
receive meals in boxes.
The two weeks in the closed loop have been “very boring,” said Xu.
After work, he spends his time chatting with his family and friends
online, he said.
To keep workers on site, SAIC is offering extra money, with some
receiving double pay for the hours they work, people familiar with
the matter said. To lighten the mood, a birthday party was organized
for those born in March, according to a company letter to the Lingang workers, posted on the campus’s official WeChat account.
https://www.wsj.com/articles/shanghais-workers-sleep-on-floors-to-keep-factories-going-amid-covid-lockdown-11648809322
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