Foxconn denies speculation about exiting mainland China amid uncertainty from trade war
- A senior Foxconn executive said last week that the company could make all US-bound iPhones for Apple outside China if necessary
- The electronics manufacturing giant makes smartphones for Apple and major Chinese brands such as Huawei, whose overseas sales have declined
Foxconn Technology Group, the world’s largest electronics contract manufacturer, has denied speculation that it plans to withdraw from the Chinese mainland, where the Taiwanese company has more than 1 million employees, as the trade row between the US and China escalates.
“The rumours about Foxconn quitting mainland China are not true,” said the company, formally known as Hon Hai Precision Industry, in a post on its official WeChat account on Monday.
The firm said that operations at all of its facilities across the mainland were orderly and that there were no plans for divestment.
Its denial via Chinese social media has come after Liu Young, Foxconn board nominee and chief of its semiconductor division, told an investor briefing in Taipei last week that the company could fully support Apple if it needs to adjust its production in case the US-China trade dispute intensifies and becomes more unpredictable.
Liu said Foxconn had enough capacity to make all iPhones bound for the US outside China if necessary, according to a Bloomberg report. Apple has not given Foxconn instructions to move production out of China, the report said.
That followed comments made in May by Foxconn founder and chairman Terry Gou Tai-ming at a press conference in Taipei, where he said the company would shut down operations on the mainland and move elsewhere if Beijing threatened its factories there if he was elected Taiwanese president, according to a Nikkei Asian Review report.
Apple’s US-bound iPhones ‘can all be made outside China if needed’
Foxconn, China’s largest private employer, said on WeChat that it considered “mainland staff as the company’s most valuable assets” and that the contract manufacturer would “deepen its development” in the country.
Over the past three decades, the electronics manufacturing giant has opened about a half-dozen factories in mainland China, where it makes smartphones for Apple and major Chinese brands such as Huawei Technologies.
But the trade war, which started with the US imposing higher tariffs on Chinese goods, recently intensified when Washington added Huawei and 68 of its non-US affiliates to a trade blacklist, officially called the Entity List, on May 16 because the company was considered a threat to national security.
This action restricts Huawei’s ability to buy hardware, software and services from its American hi-tech suppliers without approval from the US government.
Terry Gou to step back from Foxconn as it expands into India, AI
Recent moves by Foxconn suggest that the company aimed to sharpen its focus on expanding operations in other vast economies.
In April, Gou said at an event in Taipei that Foxconn will start mass production of Apple’s iPhones in India this year. He said Foxconn would become more involved in developing India’s smartphone industry.
Foxconn agreed last year to build a new manufacturing complex in Wisconsin, where it pledged to invest US$10 billion and create 13,000 jobs to qualify for up to US$4 billion in state and local government incentives. The firm plans to finish basic construction before the end of the year and start production there in May.
