11 November 2014

Apple supplier Foxconn mulls a manufacturing facility in PH

Foxconn Technology Group, the world’s largest computer manufacturer and supplier to Apple Inc., is looking a closer look at the Philippines as company officials visited various economic zones in the country.

Amadeo R. Perez Jr., chairman of the Manila Economic and Cultural Office (MECO), told reporters that Foxconn officials came over three months ago and were brought to various ecozones, including the country’s Freeport zones Subic and Clark, and Calabarzon areas such as Batangas, Laguna and Cavite.

“They are looking into several areas and they have lots of considerations, including fung shui,” Perez said. So far, Perez said there has been no word yet from Foxconn.

Government investment promotion agencies Board of Investments and the Philippine Economic Zone Authority started courting this Taiwanese firm in 2012 yet.

Foxconn has been mulling about relocating some of its capacities outside of its production hub in mainland China due to rising wage rate and shortage of available workers and has included the Philippines in its shortlist of countries as investment destination.

The company employs 1.2 million people at its China facilities producing laptops, tables and PCs for the export market. Aside from the rising cost of wage, the lack of available manpower has turned off some of multinational firms, which relocated in China based on these attractions.

Foxconn is a multinational business group anchored by the Hon Hai Precision Industry Co., Ltd., a Republic of China-registered corporation headquartered in Tucheng, Taiwan.

As the world’s largest manufacturer of electronics and computer components, Foxconn mainly manufactures on contract to other companies. Among other things, Foxconn produces the Mac mini, the iPod, the iPad, and the iPhone for Apple Inc.; Intel-branded motherboards for Intel Corp.; various orders for American computer manufacturers Dell and Hewlett-Packard; motherboards for UK computer manufacturer Zoostorm; the PlayStation 2 and PlayStation 3 for Sony; the Wii for Nintendo; the Xbox 360 for Microsoft, cell phones for Motorola, the Amazon Kindle, and Cisco equipment.

It assembles an estimated 40 percent of the smartphones, computers and other electronic gadgets sold around the world. Foxconn’s decisions set standards other manufacturers must compete with.

It has 13 factories in nine Chinese cities employing 1.2 million. Foxconn is the world’s largest maker of electronic components and the largest exporter in Greater China. Foxconn is primarily an original design manufacturer and its clients include major American, European and Japanese electronics and information technology companies. Notable products which the company manufactures include the iPad, iPhone, Kindle, PlayStation 3, Wii and Xbox 360.

Foxconn has been identified by the Global Marketing Intelligence System (GMIS) of the Department of Trade and Industry as a potential investor. Companies targeted under GMIS for investment promotion must have four common characteristics: Mass employers, the technology used in their current production is within the capability of the Philippines and can be serviced by Filipinos; if a potential company is located outside of Asia, that company must have an existing operation in Asia; and if located in the Middle East or in the Americans, they must have operation abroad. (Manila Bulletin)