Foxconn to charge firms more
Source: Agencies |
July 23, 2010, Friday
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Print Edition
Print Edition
FOXCONN Technology Group, which makes iPhones and other gadgets for global technology companies, plans to charge those companies more to partly cover wage increases at its mammoth manufacturing compound in the southern Chinese city of Shenzhen.
The extent of price hikes will differ according to products, C.L. Huang, vice president of Hon Hai Precision Industry Co, parent firm of Foxconn, said at a news conference on Wednesday night. She did not name the clients.
The Taiwan-based firm announced in June two raises, more than doubling the basic worker pay to 2,000 yuan (US$293) a month for the Shenzhen workers who make iPhones, iPads and other brand-name electronics for corporations including Apple Inc and Hewlett-Packard Co.
The raises followed 10 worker suicides at the Foxconn compound in Shenzhen. Labor activists have linked the suicides to unduly harsh conditions at the plant, where more than 300,000 people are employed.
Foxconn has become the world's largest contract manufacturer of electronics goods mainly because of its ability to cut down costs by mass producing, earning big profits for its clients such as Apple Inc.
On Tuesday, Apple announced its April-June net income surged 78 percent to US$3.25 billion on revenue of US$15.7 billion after selling almost as many of its new iPad tablets as it sold Mac computers.
Huang said Foxconn will also cover the wage increases - to become fully effective in October - by speeding up factory automation programs.
She also said Foxconn's Shenzhen compound will produce higher value-added goods while shifting low-margin production to inland factories where wages are lower.
The extent of price hikes will differ according to products, C.L. Huang, vice president of Hon Hai Precision Industry Co, parent firm of Foxconn, said at a news conference on Wednesday night. She did not name the clients.
The Taiwan-based firm announced in June two raises, more than doubling the basic worker pay to 2,000 yuan (US$293) a month for the Shenzhen workers who make iPhones, iPads and other brand-name electronics for corporations including Apple Inc and Hewlett-Packard Co.
The raises followed 10 worker suicides at the Foxconn compound in Shenzhen. Labor activists have linked the suicides to unduly harsh conditions at the plant, where more than 300,000 people are employed.
Foxconn has become the world's largest contract manufacturer of electronics goods mainly because of its ability to cut down costs by mass producing, earning big profits for its clients such as Apple Inc.
On Tuesday, Apple announced its April-June net income surged 78 percent to US$3.25 billion on revenue of US$15.7 billion after selling almost as many of its new iPad tablets as it sold Mac computers.
Huang said Foxconn will also cover the wage increases - to become fully effective in October - by speeding up factory automation programs.
She also said Foxconn's Shenzhen compound will produce higher value-added goods while shifting low-margin production to inland factories where wages are lower.
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