Foxconn Says China's 'Days as the World's Factory Are Done'

Foxconn Says China's 'Days as the World's Factory Are Done'

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Apple supplier Hon Hai Precision Industry Co, also known as Foxconn, is gradually adding more capacity outside of China, reports Bloomberg. The company's production outside the country has now reached 30%, up from 25% last June.

Foxconn is continually moving manufacturing to Southeast Asia and other regions to avoid a trade war between the United States and China. Last month, a report said the company plans to invest $1 billion to expand an iPhone assembly plant in Southern India following a 'strong request' form Apple.

Intensifying trade tensions between Washington and Beijing have pushed device manufacturers to diversify their production bases away from China, and Liu last year said that Apple’s most prized product, the iPhone, can be made outside China if needed. The two nations remain in trade talks, but Liu’s comments affirm a growing expectation that the China-centric electronics supply chain will fragment over the longer term.

“No matter if it’s India, Southeast Asia or the Americas, there will be a manufacturing ecosystem in each,” Liu said, adding that while China will still play a key role in Foxconn’s manufacturing empire, the country’s “days as the world’s factory are done.”

Foxconn reported $778 million in net income last quarter, a better than expected result due to increased demand for iPads and MacBooks. However, the company has warned that Q3 sales will be down by double digits due to a delayed iPhone launch this year.

More details in the full report linked below...

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Foxconn Says China's 'Days as the World's Factory Are Done'