|
Foxconn eyes factories in US, Indonesia as China's lustre fades
Share This!
  
Mumbai / Bangalore - February 25, 2014
Foxconn, world's leading manufacturer of computer components and systems
to 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, Chairman Terry Gou 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." at the group's annual party on Sunday to mark the end of the Chinese year.
At
the same time, 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.
Danny Lee, a Fund Manager of Mega Financial Holding's said, "Foxconn
has no choice but to do it. China is no longer a manufacturing hub for
companies worldwide, especially so for the PC industry."
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.
Kuo Ming-Chi, an Analyst at Taipei-based KGI Securities, said, "I
think they're looking more closely at the US in order to move closer to
some of their biggest clients. Obama is also really pushing to return
manufacturing to America and boost employment opportunities."
Potential of business in Indonesia
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.
The
news helped shares in Hon Hai shrug off a slide in the broader Taiwan
market. Hon Hai stocks eased 0.1 per cent, while the main index closed
1.6 per cent lower.
Best
known for putting together iPhones, Foxconn takes the honor of its
skills by meeting Apple's exacting standards and supply chain rigour. It
boasts a workforce of more than 1 million, and the scale to negotiate
cheaper component prices than BlackBerry could obtain on its own.
Gou
placed emphasis on Indonesia for future development. He said the
country, rather than India, will be best able to replace China as the
world's manufacturing hub in the future.
Kuo Ming-Chi, an Analyst at Taipei-based KGI Securities added "Foxconn
views as a rising market with great potential. There's also no shortage
of IT personnel there. He's prioritizing places with the most potential
for domestic market growth, and Indonesia is at the top of that list."
Indonesian
government officials have said Hon Hai wants to gradually invest as
much as $10 billion over 5 years with local partner Erajaya Swasembada,
and Indonesia will offer the Taiwanese firm a tax package aimed at
kick-starting the plan. Hon Hai has yet to confirm these details.
# # #
About Foxconn
Foxconn
was established in 1974 and has grown to become the largest ODM in the
world with nearly 1,000,000 employees and revenues in excess of USD 100
billion. Foxconn's customer base includes many famous brands in
computing, communications and consumer electronics, for example; Apple,
Cisco, Dell, HP, Nokia and Sony. With expertise in design and
manufacturing, Foxconn's Channel Division is able to bring barebones and
component products to channel customers around the globe, giving them
the freedom to create their own solutions. To learn more, visit: www.foxconnchannel.com.
| 
No comments:
Post a Comment