Taiwan high-tech giant Foxconn plans to shift part of its production of Apple gadgets to other parts of the country as it faces rising labour costs, reports said Tuesday.
After a run of suicides and wage hikes, Foxconn will move some manufacturing from Shenzhen to northern Tianjin and central Henan province, the Financial Times said, citing unnamed executives.
Citing local officials, China’s official Xinhua news agency said the company plans to build a massive plant in Zhengzhou, capital of Henan, that will initially employ 100,000 people and eventually 300,000.
The company was in talks with officials on details of an agreement for the plant, Xinhua said, adding that Henan had already launched a recruitment drive for the factory’s employees.
It did not say what the plant would make.
The company — which also makes products for Panasonic, Dell, Nokia and other top brands — also will boost its “investment and product portfolio” in Tianjin, the China Daily said.
The move away from its long-time manufacturing hub in Shenzhen, on the border with Hong Kong, is aimed at containing rising costs, the Financial Times said.
Plans by Foxconn to pass on some higher labour costs were not greeted favourably by Apple, the paper added, citing executives involved in negotiations between the two firms.
No one at Foxconn, the world’s biggest electronics contract manufacturer, was immediately available to comment on the reports.
A Hong Kong-based spokeswoman for Apple declined comment on the reports.
This month Foxconn announced salary increases of about 70 percent after 11 Chinese employees apparently committed suicide by jumping from buildings this year, including 10 in Shenzhen.
Labour rights activists have blamed the suicides on tough working conditions at Foxconn and Tuesday’s move comes amid increasing unrest at foreign-run factories in China as millions of workers express their discontent at low pay.
