Because the article is terribly low on actual information, below is the spec for 5G network locations services. In short, the network can ask devices to assist in locating them. Without the users consent or knowledge.

My best guess is that apple will reduce in accuracy or outright remove those features. Unless the user dials an emergency number of course.

Also, the devices named are the first ones with apples own modem, so it can be assumed that Qualcomm did not give Apple sufficient access to their modems to do this.

https://www.etsi.org/deliver/etsi_ts/123200_123299/123273/16.04.00_60/ts_123273v160400p.pdf

OK, so what are they doing (wasn't explained in the article).

Because it's pretty easy to triangulate a phone just from the towers themselves - multiple towers pickup a phone, then based on signal strength and direction from each tower it's location can be pretty closely determined.

And with 5G cells being even smaller (often 1/4 mile in urban areas), the radio signal alone, triangulated, will locate you within a meter - the phone doesn't have to do anything other than be on.