Apple production has decreased, and Foxconn, backed by the "big tree", should start to be cautious about shielding materials, absorbing waves, and conducting heat suppliers

As the saying goes, it's better to lean against a big tree for shade. Foxconn, backed by the big tree of Apple, has become the world's largest contract manufacturer with the production orders provided by Apple. However, relying too much on Apple is not a good thing. The previous case of OFILM in China is a vivid example, and the harm of relying too much on Apple will eventually become apparent. In recent times, the harm of Foxconn's "Apple Disease" has begun to emerge, and it needs to face two major issues: how to retain employees and how to counter the impact from Lite On Precision.

How to retain employees with reduced wages and fewer jobs

Earlier, Terry Gou boasted that Foxconn's construction of factories in mainland China was a way to reward mainland employees with food. This sounds reasonable because it cannot be denied that it does indeed drive employment, and employee wages are also decent. But this is not the reason why Terry Gou can boast. It should be noted that high wages for employees are earned through overtime work, and they have long starved to death with basic wages. At the same time, receiving high wages brings them more benefits. If there is work that can be done overtime and the salary is guaranteed, employees are willing to stay, but if there is less work and no need to work overtime, and the salary is not guaranteed, will employees still stay?

Affected by the global chip shortage, although the sales of Apple's new iPhone 13 series are booming and in short supply, Apple wants Foxconn and other contract factories to increase their supply. However, in the severe shortage of chips, Foxconn and other contract factories are also difficult to cook without rice. In October of this year, Apple cut off its supply for a few days, marking the first time in a decade that Apple had directly cut off its supply for several days. During those days, Foxconn's factory had no production capacity and workers were unable to do anything.

Although production may recover, as long as the chip shortage situation persists, production will inevitably continue to be affected, and there will not be enough work. Employee wages will inevitably be affected. In the short term, it is okay, but according to the chip shortage situation, the impact is long-term. It is said that Apple has reduced the production of iPhone 13 series from 95 million units to 83-85 million units. Therefore, Foxconn will face the problem of how to retain employees for a long time in the future. Last year, there were reports of a large number of employees leaving their jobs due to low wages due to insufficient work, but Foxconn later stated that they did not. It is unclear whether this is true or not.

So don't exaggerate casually. It is natural for employees to receive wages through labor, and Foxconn, as a company, has an obligation to protect the interests of its employees. If it cannot be guaranteed, employee turnover is inevitable. I felt that the salaries required to pay employees in China were high, so I went to Southeast Asia to build factories. However, the result was that I didn't just come back with a face full of dirt to recruit and produce. Employee issues are an internal concern for Foxconn, and it also faces external threats.

Lixun Precision rises strongly, snatching Foxconn's rice bowl

Apple never puts all its eggs in one basket. For the important process of product manufacturing, although Apple hands over the vast majority of orders to Foxconn, it does not necessarily mean that it must rely on it. Since Foxconn's failure to build factories in Southeast Asia had an impact on Apple's supply, Apple has decisively begun seeking new partners for cooperation. And this cooperative partner is Lite On Precision, also known as the small Foxconn in China.

It will be called "Little Foxconn" because its founder Wang Laichun was once a Foxconn employee, and in its early days, it mainly relied on orders diverted from Foxconn to survive. After growing up, it became an Apple supply chain enterprise, manufacturing AirPods devices and related components for Apple. In order to receive orders for complete assembly of Apple iPhones, it has been increasing technology research and development and improving production processes. Where there is effort, there is reward. This year, we successfully received a complete machine order from Apple, assembling and manufacturing nearly 10 million devices for Apple, and the order volume will continue to increase in the future. It can be seen that Apple is intentionally tilting orders towards Luxshare Precision to help it grow, and Apple wants to weaken Foxconn's role and reduce dependence.

Apple wants to create a second Foxconn, which is extremely bad news for Foxconn, which relies on Apple orders for survival. Although it won't be directly abandoned, a portion of the rice bowl will definitely need to be separated. Faced with the external threat of Lixun Precision, what should be done is enough to give it a headache. In the face of internal and external troubles, Foxconn needs to think of a way out and be prepared for danger in times of peace.

It is good to keep cool by backing against the apple, but when the apple itself is affected and does not want to keep cool for you, you will face a storm. The first generation factory is just a name in front of Apple. Apple's interests are paramount, there are no absolute partners, only eternal interests. The harm of Foxconn's excessive dependence on Apple is beginning to manifest, and no matter how it responds, it is enough for it to drink a pot.

However, it is said that Foxconn built its first wafer level packaging and testing plant in Qingdao earlier, probably to cope with the impact of losing Apple by opening up new businesses. This multi domain development is a good way to deal with it. If Luxshare Precision receives more Apple orders in the future, it also needs to use a multi domain development strategy to reduce its dependence on Apple, after all, Apple is too ruthless.

The sequelae of Foxconn's' Apple Disease 'are beginning to manifest

Apple production has decreased, and Foxconn, backed by the "big tree", should start to be prepared for danger in times of peace

2. I hope to work together with Guanghong Technology to achieve the goal of 40 million smartphones next year

Yidetong news, according to the official account of Guanghong Technology, the offline ceremony of 20 million Xiaomi smartphones of Guanghong Technology was held in the Third Intelligent Industrial Park on the afternoon of December 29.

Zeng Xuezhong, Senior Vice President and President of the Mobile Department of Xiaomi Group, stated that since the cooperation between the two parties, Guanghong Technology's full cooperation and investment in Xiaomi are evident, and he thanks the Guanghong team for their strong support to Xiaomi. The launch of 20 million Xiaomi smartphones this time is the result of joint efforts between both parties and a milestone achievement, which is of great significance to both Xiaomi and Guanghong Technology.

Meanwhile, it is hoped that next year, with a complete supply chain, we can work together with Guanghong Technology to achieve the goal of 40 million Xiaomi smartphones.

Guanghong Technology stated that the third phase of Guanghong Technology's MI Park has been fully operational and can accommodate more production needs. We look forward to working together with Xiaomi to further deepen our all-round cooperation and expand our product line.

It is reported that in order to fully guarantee the construction of the Xiaomi project and ensure high-quality and efficient production and delivery of the project, Guanghong Technology has planned various guarantee measures in multiple dimensions such as site planning, capacity construction, NPI capacity construction, and quality control. At the same time, it has increased resource investment, built a laboratory of about 500 square meters, further strengthened the technical team, and enhanced the professional technical ability of personnel to ensure efficient and high-quality completion of delivery tasks. With the joint efforts of both teams, 20 million smartphones were successfully taken offline with high quality and quantity.