Posts tagged ‘Foxconn’

12/06/2016

Electronics Maker Automates as China Costs Rise – China Real Time Report – WSJ

Regardless of the assurances, I am concerned that we have started down a very slippery slope and in a generation or two we will have personless factories and maybe personless offices.  When that happens where will humans be earning salaries and hence, are going to be buying the stuff the factories will be churning out and who will pay for the offices; and – indeed – what will be done in those offices?

Is anyone in government, whether Chinese, Swedish, Japanese or American, putting their minds to this frightening future?

“A new generation of machines is gradually transforming this electronics factory in China’s manufacturing hub.Inside the sprawling factory, owned by Jabil Circuit Inc.—the world’s third-largest contract manufacturer for companies such as Apple Inc. and Electrolux SA—robotic arms assemble circuit boards as driverless components-laden carts glide nearby. Machines also are starting to replace workers in checking circuit-board assemblies for errors.

“This is the past,” said David Choonseng Tan, an operations director at Jabil, pointing to a line of workers hunched over the assembly line. “And this,” he said, gesturing to a line of machines next to them, “is the future.”

Rapidly changing product models make it challenging for electronics companies like Jabil to automate all aspects of the assembly process, according to John Dulchinos, a vice president at the company. Still, Jabil has increasingly embraced automation and advanced technology, a shift encouraged by the Chinese government as the world’s second-largest economy grapples with labor shortages and high costs that are making neighboring countries like Vietnam increasingly competitive for mass production.

Manufacturers elsewhere in the world are also investing in automation and robotics in an effort to wean themselves off “chasing the needle”—moving to ever-lower-cost countries in pursuit of cheap labor.

In Stockholm, Sweden, roughly 8,000 miles away from China, fuel-cell maker myFC has built a 2,000 square-foot smart factory that will eventually have five robots doing the work of 20 full-time humans. The robots assemble power cards used for portable electronic devices while 3D printers churn out prototypes of new designs.

“We are building one cell, then we can export that to any country, any customer,” says Bjorn Westerholm, chief executive of myFC.

Jabil says that it’s hoping that a key piece of its automation—a boxy white platform it calls Flexi-Auto Cell—can also be redeployed at factories elsewhere in the world. The idea, according to Jabil, is for technology to be able to emulate the worker’s flexibility in switching from one task to another.

Jabil’s vision of manufacturing, however, isn’t one in which machines will replace workers completely, but rather one in which they’re freed up to focus on less-tedious tasks.

“We are not going for a lights-off factory,” says KC Ong, a senior vice president of operations for Jabil. In the factory of the future, “we’ll still have a lot of people.””

Source: Electronics Maker Automates as China Costs Rise – China Real Time Report – WSJ

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27/05/2016

Foxconn replaces ‘60,000 factory workers with robots’ – BBC News

If manufacturers like Foxconn and high street companies like McDonald’s and, no doubt soon, offices too start replacing humans with robots, where will it all end? Where will all the ‘surplus’ people find jobs and pay.  And, eventually, who will be able to afford the iPhones, the hamburgers and so forth?  Won’t it be self-defeating in the long run for the employers with no customers or, at best, not enough customers to keep all the robots occupied and earning their keep.

“One factory has “reduced employee strength from 110,000 to 50,000 thanks to the introduction of robots”, a government official told the South China Morning Post.

Xu Yulian, head of publicity for the Kunshan region, added: “More companies are likely to follow suit.”

China is investing heavily in a robot workforce.

In a statement to the BBC, Foxconn Technology Group confirmed that it was automating “many of the manufacturing tasks associated with our operations” but denied that it meant long-term job losses.

“We are applying robotics engineering and other innovative manufacturing technologies to replace repetitive tasks previously done by employees, and through training, also enable our employees to focus on higher value-added elements in the manufacturing process, such as research and development, process control and quality control.

“We will continue to harness automation and manpower in our manufacturing operations, and we expect to maintain our significant workforce in China.”

Since September 2014, 505 factories across Dongguan, in the Guangdong province, have invested 4.2bn yuan (£430m) in robots, aiming to replace thousands of workers.

Kunshan, Jiangsu province, is a manufacturing hub for the electronics industry.

Economists have issued dire warnings about how automation will affect the job market, with one report, from consultants Deloitte in partnership with Oxford University, suggesting that 35% of jobs were at risk over the next 20 years.

Former McDonald’s chief executive Ed Rensi recently told the US’s Fox Business programme a minimum-wage increase to $15 an hour would make companies consider robot workers.

“It’s cheaper to buy a $35,000 robotic arm than it is to hire an employee who is inefficient, making $15 an hour bagging French fries,” he said.”

Source: Foxconn replaces ‘60,000 factory workers with robots’ – BBC News

20/08/2015

What Stands in the Way of Modi’s Digital India – The Numbers – WSJ

Indian Prime Minister Narendra Modi has grand plans to expand the reach of the Internet to his country’s most far-flung citizens.  But some big numbers stand in his way.

1.06 billion

The number of Indians who currently don’t have access to the Internet. India’s offline population is greater than that of China and Indonesia–home to the next two largest unconnected groups–combined.

1 million

The number of miles of fiber optic cable needed to connect 250,000 village clusters in India to the Internet, according to a committee set up to get the project into gear. The original plan estimated that 370,000 miles of cable would do the job.

1%

The proportion of clusters of villages that up to June 30 were fully connected to Internet services in community centers, hospitals and schools under the National Fiber Optic Network that was launched in 2011.

2013

The original deadline for completion of the network. The date has since been shunted back twice and now stands at 2019.

$11.2 billion

The revised budget for the fiber optic network. Almost four times what was originally planned.

via What Stands in the Way of Modi’s Digital India – The Numbers – WSJ.

10/08/2015

5 Things to Know about Foxconn’s Overseas Ambitions – WSJ

Foxconn, Apple Inc.’s major assembler, has signed a preliminary deal with India’s Maharashtra state to invest $5 billion in factories and research facilities in coming years. But the company, officially known as Hon Hai Precision Industry Co., has a history of making ambitious statements and floating investment ideas that haven’t materialized. Here are five things to know about Foxconn’s overseas ambitions.

Deutsch: Foxconn Logo

Deutsch: Foxconn Logo (Photo credit: Wikipedia)

1 India isn’t its first billion-dollar bet

In 2011, Foxconn agreed to invest $12 billion in Brazil to create a new supply chain that it had hoped will generate jobs. But four years later, Foxconn’s investment in Brazil has been much smaller than the pledged amount. It is still struggling to improve the manufacturing operations at its plants for iPhones and iPads there citing its inefficient labor force. The company has also been in talks for a new plant investment in Indonesia for years.  The Indonesian government once said that Foxconn would invest up to $10 billion, but plans remain in limbo due to political snags.

2 Why India?

While China remains the world’s largest smartphone market by shipments, India has the biggest growth potential for the next 5 years, says Bernstein analyst Mark Li. India recently raised taxes on mobile phones imported to the country to 12.5% from 6%, spurring global handset makers to look at ways to manufacture devices locally.

3 Sign of shift in manufacturing to India from China?

Analysts say it is unlikely that India will overtake China to become the company’s main production base in the next few years as China has an well-established supply chain ecosystem. India still lacks good infrastructure and favorable tax and labor policies, making it a less attractive destination for tech manufacturing.

4 Foxconn Chairman Terry Gou always aims for the best deal

The agreement with the Indian government is non-binding. Foxconn Chairman Terry Gou usually gives a rosy picture about the company’s potential investments when he negotiates with government officials. But only a few investment plans materialize as he wants favorable terms including big tax incentives and free land that most governments can’t accommodate.

5 Foxconn seeks other investment opportunities in India

The company and Chinese e-commerce giant Alibaba Group Holding Ltd. are in talks to jointly invest about $500 million in Snapdeal.com, a five-year-old Indian e-commerce startup. The deal would give Foxconn a retail foothold in India where it has experienced booming demand for smartphones. Foxconn is also setting up a new production site for Chinese smartphone maker Xiaomi Corp. in India.

via 5 Things to Know about Foxconn’s Overseas Ambitions – WSJ.

10/08/2015

China’s Xiaomi to Make Smartphones in India – India Real Time – WSJ

Chinese smartphone maker Xiaomi Corp. will begin manufacturing phones in the southern Indian state of Andhra Pradesh, according to the state’s highest elected official.

A tweet from the verified account of N. Chandrababu Naidu, the state’s chief minister, said Xiaomi would announce the move today.

Xiaomi’s move follows Taiwanese contract manufacturer Foxconn’s announcement Saturday that it plans to spend $5 billion on factories and research and development in the western state of Maharashtra. Foxconn, known officially as Hon Hai Precision Industry Co. assembles Apple Inc. iPhones and as well as most of Xiaomi’s phones. Foxconn has a plant in Andhra Pradesh.

The Indian government amended its customs rules recently to make it more attractive to make electronic goods in India, as it seeks to boost manufacturing, create jobs and reduce reliance on expensive imports from China.

via China’s Xiaomi to Make Smartphones in India – India Real Time – WSJ.

13/03/2015

Bargaining With Chinese Characteristics: Labor Group Defends Practices – China Real Time Report – WSJ

When Chinese Premier Li Keqiang omitted a reference to collective bargaining in an annual policy speech last week, labor scholars worried that Beijing may be backing away from a much-needed policy tool for dealing with rising industrial unrest.

China’s state-controlled trade unions are seeking to allay such concerns. They are pledging to keep promoting collective bargaining in a way that calms labor tensions without derailing growth in the country’s already-slowing economy.

“Collective wage bargaining is something we will continue to promote,” said Li Shouzhen, a senior official at the All-China Federation of Trade Unions, or ACFTU. “It is a tried-and-tested process that’s practiced by successful enterprises.”

via Bargaining With Chinese Characteristics: Labor Group Defends Practices – China Real Time Report – WSJ.

27/01/2015

Apple supplier Foxconn to shrink workforce as sales growth stalls | Reuters

Is this the beginning of the end for off-shoring manufacturing?

Taiwan‘s Foxconn Technology Group, the world’s largest contract electronics manufacturer, will cut its massive workforce, the company told Reuters, as the Apple Inc (AAPL.O) supplier faces declining revenue growth and rising wages in China.

Employees work inside a Foxconn factory in the township of Longhua in the southern Guangdong province in this May 26, 2010 file photo.  REUTERS/Bobby Yip

Under its flagship unit Hon Hai Precision Industry Co Ltd (2317.TW), the group currently employs about 1.3 million people during peak production times, making it one of the largest private employers in the world.

Special assistant to the chairman and group spokesman Louis Woo did not specify a timeframe or target for the reduction, but noted that labor costs had more than doubled since 2010, when the company faced intense media scrutiny following a spate of worker suicides.

“We’ve basically stabilized (our workforce) in the last three years,” Woo said. When asked if the company plans to reduce overall headcount, he responded “yes”.

Revenue growth at the conglomerate tumbled to 1.3 percent in 2013 and only partially recovered to 6.5 percent last year after a long string of double-digit increases from 2003 to 2012.

That decade saw the firm ride an explosion of popularity in PCs, smartphones and tablets, largely driven by its main client Apple, but now it is feeling the effects of falling growth and prices in the gadget markets it supplies, a trend that is expected to continue.

Growth in smartphone sales will halve this year from 26 percent in 2014, according to researcher IDC, while PC sales will contract by 3 percent.

Similarly, the average smartphone will sell for 19 percent less in 2018 than last year’s $297.

“Even if technology is improving, the price will still come down,” Woo said. “We’ve come to accept that, our customers have come to accept that.”

Automation will be key to keeping labor costs under control in the long-term, Woo said, as the company pushes to have robotic arms complete mundane tasks currently done by workers.

But Woo noted that company chairman Terry Gou‘s previously stated goal of 1 million robots was “a generic concept” rather than a firm target.”

via Exclusive: Apple supplier Foxconn to shrink workforce as sales growth stalls | Reuters.

05/11/2014

Poetry of a Former Foxconn Worker in China Evokes Images of Factory Life – Businessweek

Before he took his life in late September, 24-year-old Xu Lizhi was a regular contributor of poetry to Foxconn People, the internal newspaper at his sprawling factory complex in Shenzhen. Only after he died did his writing find a wider audience, as factory friends collected his poems for publication in the Shenzhen News.

Safety netting posted around a building in Foxconn City in Shenzhen, China

Like millions of other young Chinese, Xu left his home in rural Guangdong province in 2010 to find work in the big city; he had been working intermittently on Foxconn (2317:TT)’s electronics assembly line for four years.

Following a series of 14 suicides in 2010, the Taiwanese manufacturing giant installed safety nets to prevent workers from jumping off dormitory roofs at its Shenzhen plant. It tried to improve life for its workers: The company raised basic wages and installed basketball courts and Olympic-size swimming pools for recreation. Worker suicides declined but did not disappear.

Xu’s poetry gives voice to the alienation he and many others of his generation feel on the assembly line: “I swallowed a moon made of iron/ They refer to it as a nail/ I swallowed this industrial sewage, these unemployment documents/ Youth stooped at machines die before their time/ I swallowed the hustle and the destitution/ Swallowed pedestrian bridges, life covered in rust / I can’t swallow any more/ All that I’ve swallowed is now gushing out of my throat/ Unfurling on the land of my ancestors/ Into a disgraceful poem.”

A frequent theme is how he felt the monotony of factory life sapping away “the last graveyard of our youth.” In one poem, Xu wrote: “With no time for expression, emotion crumbles into dust/ They have stomachs forged of iron/ Full of thick acid, sulfuric and nitric/ Industry captures their tears before they have the chance to fall.”

Xu also described the desolate conditions of his rented room: “A space of ten square meters/ Cramped and damp, no sunlight all year/ Here I eat, sleep, sh–, and think/ Cough, get headaches, grow old, get sick but still fail to die/ Under the dull yellow light again I stare blankly, chuckling like an idiot.”

via Poetry of a Former Foxconn Worker in China Evokes Images of Factory Life – Businessweek.

15/07/2014

Apple Manufacturer Foxconn Goes Green in China’s Guizhou – Businessweek

Guizhou may be one of China’s poorest and least developed provinces. But the flip side is an environment so pristine that President Xi Jinping recently joked its air should be bottled.

Terraced fields of rice paddies are farmed on June 4, 2013, in Jinping county, Guizhou province, China

Now, Taiwan’s Foxconn Technology Group (2317:TT), the world’s largest consumer electronics producer, with more than a million employees working in 30-some industrial parks across China, has set its sights on backward but beautiful Guizhou.

The maker of Apple’s (AAPL) iPad and iPhone and Hewlett-Packard (HPQ) servers is building an industrial park in China’s southwest, seemingly worlds away from its massive and gritty Shenzhen manufacturing base, that aims to be state of the art in energy efficiency and environmental friendliness. Set among karst hills on the outskirts of Guiyang, the provincial capital, the 500-acre park will keep about 70 percent of the natural vegetation undisturbed.

via Apple Manufacturer Foxconn Goes Green in China’s Guizhou – Businessweek.

25/03/2013

* Wages Rising in Chinese Factories? Only For Some

Working in these Times: “If we are to take recent news reports at face value, the collective conscience of the worlds consumers can be eased, because conditions at Chinese factories are improving.

Last year, The New York Times told us that these workers are “cheap no more,” and just this February, the Heritage Foundation, touting the virtues of global free trade, claimed that Chinese factory wages have risen 20 percent per year since 2005. Foxconn, Apples major supplier and the manufacturer of approximately 40 percent of the worlds consumer electronics, says it will hold free union elections every five years.

But Pollyannas should take pause: The average migrant workers $320 monthly salary in 2011 was actually 43 percent less than the $560 national average, according to government statistics. And though its true that Foxconn will permit the election of union leaders, we have yet to see how much Chinas so-called democratic unions can empower the workers they purport to represent.

Skepticism and caveats aside, the reality is that the lot of formal production workers in China is indeed advancing, however slowly and painfully. But that is true only for formal workers. What many consumers and observers fail to note are the perilous conditions of Chinas temporary production workers and the increased tendency among Chinese factories to use such workers to manufacture the brand-name products that fill your home.

Factories supplying Apple and Samsung, for example, make heavy use of temp workers. According to official statistics, temp workers make up 20 percent of Chinas urban workforce of 300 million, though the proportion in individual factories often tops 50 percent. As China turns into a land of short-term workers, there are grave implications for labor, companies, and Chinese society.”

via Wages Rising in Chinese Factories? Only For Some – Working In These Times.

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