iPhones, cars and furniture can simply accumulate if our industry with China stops.
Foxconn is operating on a production line in 2010. Photo: Thomas Lee / Bloomberg Source: Supplied
The president of the company that manufactured the device on which he reads this believes that China’s days as a dominant force in electronic production are “finished.”
Foxconn is a Taiwanese company that partners with device brands such as Apple, Dell, Microsoft, Sony and other multinationals to produce their devices, but for years very few people had heard of the company.
Foxconn at a factory in Guizhou Province, China, in 2018. Photo: Aleksandar Plavevskiepa / Shutterstock Source: Supplied
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In 2010, the organization gained importance for all reasons, following a wave of suicides and suicide attempts through its factory staff.
Foxconn solved the problem by installing networks.
The company remains a component of the home chain of many companies, but according to its president Young Liu, “the days when the global factory is finished,” Bloomberg reported.
Device brands have diversified their home chains in reaction to the restrictive price lists of the Chinese-made products industry in the United States.
The increased demand for iPads and laptops, as more and more people paint the pandemic from home, helped Foxconn in the last quarter. Photo: Glenn Chapman / AFP Source: AFP
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Foxconn now has about 30% of its total production capacity outside China.
In 2017, it announced that the company would get $3 billion ($1.18 billion) in tax incentives to build a $10 billion (A$13.95 billion) plant in the US state of Wisconsin to produce big-screen televisions.
According to The Verge, the price of government tax subsidies has exceeded $4.5 billion (A$6.28 billion), the plant has been reduced and to date no television has been produced.
Earlier this year, Foxconn predicted production would begin until the end of 2020, but the coronavirus pandemic means that may not happen.
Foxconn has produced game consoles such as Xbox One (above), PS4 and Nintendo Switch. Picture: Dylan Coker Source: News Corp Australia
There are another seven billion people in the world and only about 3 billion of them use smartphones, so there is still a lot of reasonable hard work to produce those devices outside China in less economically complex places.
Countries that might once have been called the “third world” are generating electronic products.
“Whether in India, Southeast Asia or the Americas, there will be a production ecosystem in all of them,” Foxconn’s president told reporters after delivering its quarterly effects on Wednesday.
The maximum of this ecosystem is increasingly likely to be in India, such as the time when the most populous country after China is looking for a generation production center.
Samsung’s Note 20 Ultra is manufactured in India, but through Foxconn.
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Foxconn has transferred some of the production of the iPhone 11 and iPhone SE to India (where Apple owns about 1% of the smartphone market because few people can do it).
Long-lasting models will most likely also be mounted there.
The production of iPhones in India also avoids an import tariff of 20% that the country imposes on electronic products manufactured abroad, which gives Apple the possibility to participate in the market.
Samsung’s upcoming Note 20 Ultra is also manufactured in India (but not through Foxconn), which can contribute to the 500,000 pre-orders that have already been won there.
India recently announced a $9.2 billion incentive program to bring local smartphone production to life, which Foxconn, Samsung and 20 other corporations have asked for a share, for which 60% of manufactured devices will have to be exported.
LG assembled its mid-range Velvet smartphone in Vietnam.
Foxconn is lately about to recover from a record drop when the pandemic wreaked havoc in the first quarter of 2020.
Since the company is a key spouse in Apple’s production, Foxconn was also very lucky when other people ran from home and bought new laptops and tablets to do so.
The company has forecast a drop in sales for the third quarter to the same last year, as Apple delays the launch of its iPhone.