Rising costs and labour unrest in China makes the company turn towards US and Indonesia
Foxconn announced that it will build high-tech factories in the United States and low-cost plants in Indonesia as the appeal of “made in China” fades into a burden.
Beset by rising costs and labour unrest in China, Terry Gou, Chairman, Foxconn, said, “Foxconn is considering diversifying away from its manufacturing heartland. The world’s largest contract maker of electronic goods has little choice if it’s to protect margins and stay ahead of peers who have adapted the Foxconn playbook into their own success stories. The US is a must-go market. Many customers and partners have asked Foxconn to open shop in the US, with an eye on advanced manufacturing much closer to their home base.”
As per the release, Indonesia will be a top priority this year as a potential production base with attractive costs and skills. That would tie in with Foxconn’s deal to design and a market phone in the country with BlackBerry Ltd as the Canadian company seeks to reverse its decline in the smart phone business.
The company states that in the US, Foxconn business is like flagship for the unit of Hon Hai Precision Industry Co Ltd. Foxconn Technology Co Ltd and FIH Mobile could take advantage of geographical proximity to open up new deals with partners like Apple as they develop new gadgets.
According to Terry Gou, Foxconn’s ambitious growth plans could see it lift annual revenue to T$10 trillion ($333 billion, Dh1,223 billion) a decade from now.
