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Foxconn Considers Operation In Vietnam Amidst US-China Trade Tensions

Foxconn Considers Operation In Vietnam Amidst US-China Trade Tensions

Taiwan’s Foxconn technology group, the world’s biggest electronics contract manufacturer and a key Apple supplier has recently acquired the right to use a property in an industrial park in northern Vietnam. The company is reportedly considering setting up an iPhone manufacturing facility in Vietnam to mitigate the negative impacts of the ongoing US-China trade war.

Vietnam would serve as an additional production base to shelter operations from the trade tension and is one of the preferred locations as compared to India. According to Le Dang Doanh, the former economic adviser of the Vietnamese government, Vietnam has joined multiple trade pacts including the recently-ratified Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) which would allow iPhones to be exported to many member countries with lower tariffs. Following an investment of US$5 billion in Vietnam in 2007, Foxconn could leverage on its existing operations in Vietnam to continue expansion of investments in the country.

However, Vietnam has a low number of supporting business and lower credit ratings as compared to India. Although high iPhone import tariffs due to the ‘Make in India’ policy might deter Foxconn from India, greater labour and English skills could make India a prime location as well.

Taiwanese companies have invested estimated US$31 billion in more than 2,530 projects in Vietnam, making them one of the top 10 investors of Vietnam.

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Taiwan’s Foxconn To Cut 10,000 Jobs In 2018 To Automate Operations

Taiwan’s Foxconn To Cut 10,000 Jobs In 2018 To Automate Operations

Taipei, Taiwan: The Innolux company—part of the Foxconn corporation that produces display panels, announced that it will be cutting 10,000 jobs in Taiwan amid a move to automate its production line. The news was confirmed by Tuan Hsin-Chien, honorary chairman, Foxconn.

According to the Inquirer, Tuan said that Innolux was preparing for about 16-percent cut of its workforce in 2018. At a press conference, he specified a workforce of over 60,000 to drop below 50,000, coinciding with a new manufacturing system to automate around 75 percent of display panel production process.

This production line upgrade is in line with Foxconn’s development of a new “active mini-matrix LED” screen that reportedly outperforms existing display screens, reported the Inquirer. The news screen is also designed to be foldable.

Despite the inevitability of automation in more industries during upcoming years, Foxconn’s announcement disturbs people like those in Wisconsin, US, who are slated to construct a US$4.5 billion Foxconn manufacturing facility.

During negotiations between Scott Walker, Wisconsin’s state governor, and Foxconn, there had been no safeguards mentioned against automation as it was not considered a serious concern, said Wisconsin-based media sources.

Currently, it seems a valid concern that workers in the US state may be entering a potentially unfair deal, according to David Bowen—a former state representative.

Foxconn is sought to outline its automation plans for the Wisconsin plant. That way, the local population can right expectations should there be a timeline to automate production process at the future facility.

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