Tag: foxconn

Apple Supplier Foxconn to Invest in Telangana for Electronics Manufacturing Facility

Apple supplier Foxconn will invest an undisclosed sum in India’s southern state of Telangana towards an electronics manufacturing facility in the south Indian state, the state’s chief minister said on Thursday.

The investment will create 100,000 jobs in the state, Telangana’s IT minister KT Rama Rao said. The announcement followed a meeting between Telangana’s chief minister and the chairman of Foxconn earlier in the day.

Taiwan-based Foxconn already has operations in Andhra Pradesh and Tamil Nadu, where it manufactures products for companies such as Apple and Amazon.com.

It was reported earlier last month that India’s southern state Karnataka is also in serious talks with Taiwan’s Foxconn over investment plans, Chief Minister Basavaraj Bommai confirmed, potentially setting it up as the Indian third state to host Foxconn.

“We are in serious discussion of investment plans with Hon Hai Technology Group (Foxconn) at their Taiwan HQ & look forward to a fruitful collaboration,” Bommai said in a tweet. “We remain committed to welcome the best companies to the state & reap rewards for our people.”

The state’s investment promotion arm also tweeted that representatives held a meeting at the company’s Taiwan headquarters to discuss the investment, without providing further details.

Foxconn is said to be the world’s largest electronics manufacturer. As of last year, it ranks 20th in the Fortune Global 500.

Foxconn has 173 campuses and offices in 24 countries or regions around the world.

The primary product segments for the company include smart consumer electronics (smartphones, TVs, game consoles, among others), cloud and networking products (servers, communication networks), computing products (computers, tablets) and components and others (connectors, mechanical parts, services).

Meanwhile, a joint venture of Indian conglomerate Vedanta and electronics manufacturing giant Foxconn had in February finalised the Dholera Special Investment Region near Ahmedabad city of Gujarat for setting up their semiconductor and display manufacturing facility, a senior state government official said.

 

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Foxconn-Vedanta to Open India’s First Semiconductor Facility in Dholera

A joint venture of Indian conglomerate Vedanta and electronics manufacturing giant Foxconn has finalised the Dholera Special Investment Region near Ahmedabad city of Gujarat for setting up their semiconductor and display manufacturing facility, a senior state government official said on Monday.

In the biggest ever corporate investment in the history of independent India, a joint venture of Vedanta and Foxconn in September last year signed a Memorandum of Understanding (MoU) with the Gujarat government to invest Rs. 1,54,000 crore to set up the plant in the state. This will be the first manufacturing facility for semiconductors in India.

At that time, the joint venture company had not disclosed the exact location of the facility.

“After a detailed site analysis in consultation with Gujarat government authorities, the joint venture entity of Vedanta and Foxconn has selected Dholera SIR for setting up their semiconductor and display manufacturing facility. The project is in the advanced stage of evaluation by the government of India,” the official said.

The MoU was signed in September last year in Gandhinagar in the presence of Minister for Railways, Communications, Electronics and Information Technology, Ashwini Vaishnaw.

Both the companies would invest Rs. 1,54,000 crore to set up the facility in Gujarat, which would create one lakh job opportunities, Gujarat Chief Minister Bhupendra Patel had said on the occasion. Patel had also said his government will provide cooperation to set up the facility and to make it a success.

Notably, Prime Minister Narendra Modi, while addressing a poll rally in Bhavnagar in November ahead of the Assembly polls, had given clear indication that the mega semiconductor plant will come up at Dholera SIR, nearly 100 km from Ahmedabad.

This project is likely to get huge subsidies and incentives, like zero stamp duty on land purchase and subsidised water and electricity, under the ‘Gujarat Semiconductor Policy 2022-27’ announced by the state government in July last year.

Gujarat became the first state in the country to have such a dedicated policy for the semiconductor and display fabrication sector, a government official earlier said.

Under this policy, eligible projects will be given 75 percent subsidy on the purchase of the first 200 acres of land for setting up manufacturing units. The eligible projects will be provided good quality water at the rate of Rs. 12 per cubic metre for the first five years.

To encourage investors under the policy, the state government has also announced to reimburse 100 percent of stamp duty which investors would pay for the first time for taking land on lease, sale or on land transfer.

Samsung’s Galaxy S23 series of smartphones was launched earlier this week and the South Korean firm’s high-end handsets have seen a few upgrades across all three models. What about the increase in pricing? We discuss this and more on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.
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Vedanta’s Semiconductor Unit in Gujarat to Be Headed by David Reed; to Manufacture Chips for Phones, Laptops

Anil Agarwal-led Vedanta on Monday named industry veteran David Reed to head its semiconductor unit where it is looking to invest $20 billion (nearly Rs. 1,65,600 crore) to manufacture chips essential for mobile phones to laptops and TV sets.

In an interview with PTI, Agarwal said the group is looking to start manufacturing semiconductors at Dholera in Gujarat in 2-3 years.

“We will start with $5 billion (nearly Rs. 41,400 crore) investment and scale it up as years go by,” he said.

The semiconductors will be manufactured in joint venture with Taiwanese electronics company Foxconn. Vedanta holds a 63 percent interest and the remaining is with Foxconn in the joint venture.

The company plans to initially produce 40,000 wafers a month.

Before joining Vedanta, Reed was with NXP Semiconductors, where he was Executive Vice President and General Manager of global operations.

He moved to NXP as part of the merger with Freescale Semiconductor, where he had served as Senior Vice President for manufacturing operations. Previously, David was Vice President and General Manager at GlobalFoundries.

He began his career at Texas Instruments in 1984, where he served for 26 years in a variety of leadership roles across the world.

In September 2022, Vedanta signed an MoU with Gujarat government to set up India’s first semiconductor fab unit, a display fab unit, and a semiconductor assembling and testing unit in the state.

Vedanta Group has earlier announced that the group has earmarked investments of up to $20 billion for semiconductor business, and it plans to invest $15 billion (nearly Rs. 1,24,200 crore) in the first 10 years.

Vedanta will look at making a 28 nanometer (nm) chipset.

It has also applied for setting up a display fabrication plant to make screens that are used for display in electronic devices. 

 

Samsung’s Galaxy S23 series of smartphones was launched earlier this week and the South Korean firm’s high-end handsets have seen a few upgrades across all three models. What about the increase in pricing? We discuss this and more on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.
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Apple Wants to Raise India’s iPhone Production Share to 25 Percent, Says Piyush Goyal

Apple wants India to account for up to 25 percent of its production from about 5 percent – 7 percent now, Commerce and Industry Minister Piyush Goyal told a conference on Monday, as the iPhone maker continues to move its manufacturing away from China. 

“Apple, another success story,” Piyush Goyal said, pitching India as a competitive manufacturing destination. “They are already at about 5-7 percent of their manufacturing in India. If I am not mistaken, they are targeting to go up to 25 percent of their manufacturing. They launched the most recent models from India, manufactured in India.” 

Goyal did not say when Apple wants to meet the target. Apple did not immediately respond to a request for comment. 

Cupertino, California-based Apple has bet big on India since it began iPhone assembly in the country in 2017 via Wistron and later with Foxconn, in line with the Indian government’s push for local manufacturing. 

Foxconn plans to quadruple the workforce at its iPhone factory in India over two years, sources told Reuters late last year. 

Ashwini Vaishnaw, Indian’s electronics and information technology minister, tweeted on Monday that Apple’s exports from India had hit $1 billion (about Rs. 8,141 crore) in December. 

China’s COVID-related lockdowns and restrictions, and rising trade and geopolitical tensions between Beijing and Washington, have influenced Apple’s plans to shift production elsewhere. 

J.P.Morgan analysts estimated last year that a quarter of all Apple products would be made outside China by 2025, from 5 percent currently. 

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iPhone Maker Foxconn Says Output at Largest China Plant Recovering Despite Revenue Drop

Foxconn, the world’s largest contract electronics maker, said on Thursday output at its iPhone plant in China had “basically returned to normal” and December revenue, down 12.3 percent year-on-year, marked the start of a recovery.

Production of Apple iPhones faced disruption ahead of Christmas and January’s Lunar New Year holidays, after curbs to control COVID-19 prompted thousands of workers to leave Foxconn’s factory lines in China’s Zhengzhou city.

Although lower compared with the previous year, the company said revenue for December was better than it expected and that a “gradual recovery” at its Zhengzhou plant had contributed to “double-digit growth” in revenue for its smart consumer electronics business compared to November.

A Foxconn source familiar with the matter, who could not be named because they were not authorised to speak to the press, said the growth in December compared to the month prior for its consumer electronics business, including smartphones, showed major client Apple did not cut orders.

A high base from a year earlier, when demand for smartphones revived after the early impact of the pandemic, also led to the yearly decline in revenue, the person added.

Revenue for 2022 rose 10.47 percent from the previous year to a record high, driven by growth across major product lines from smartphones to servers, the company said.

In the fourth quarter, the Zhengzhou plant grappled with strict COVID-19 restrictions, now being eased, that fuelled discontent among workers over conditions at the factory. It was also hit by worker unrest over pay.

Foxconn has offered bonuses to attract new workers and convince others to stay on.

A company source told Reuters last month it aimed for the plant to resume full production around late December-to-early January.

Analysts say Foxconn assembles around 70 percent of iPhones, and the Zhengzhou plant produces the majority of its premium models including iPhone 14 Pro.

The company said in Thursday’s statement it expects first-quarter revenue “to be roughly in line with market consensus,” without elaborating.

Analysts expect first-quarter revenue to grow by 5.6 percent year-on-year, according to Refinitiv.

Foxconn shares closed down 0.1 percent, below the broader market which ended up 0.72 percent.

© Thomson Reuters 2023

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Foxconn to Ease COVID-19 Restrictions at Biggest iPhone Factory in China, End ‘Closed Loop’ System

The company that assembles Apple’s iPhones has announced it is easing COVID-19 restrictions at its largest factory in China that led thousands of workers to quit and drastically slowed production.

Foxconn Technology said in a statement on one of its official WeChat social media accounts that it would end the so-called “closed loop” system at the facility in Zhengzhou, central China, that required workers to stay in their workplaces and dormitories to prevent the spread of coronavirus infections.

The move announced Wednesday came about a week after China began easing harsh COVID-19 curbs despite signs the number of infections is rising.

Following a spate of protests across the country last month many “zero-COVID” restrictions were lifted. That means people no longer need to take frequent COVID-19 tests to travel on public transport. If they do test positive for the virus, they can isolate at home if they have only mild or no symptoms instead of being sent to a quarantine center.

Chinese President Xi Jinping’s government is still officially committed to stopping virus transmission. But the government’s latest moves suggest authorities will tolerate more infections without quarantines or shutting down travel or businesses.

Thousands of workers at the huge factory in Zhengzhou walked out in late October over complaints of unsafe working conditions — such as food shortages due to closed cafeterias — and a virus outbreak at the plant.

The last quarter of the year is typically a busy season for companies like Foxconn as they ramp up production ahead of the end of year holiday rush. Apple has warned that iPhone 14 deliveries would be delayed due to manufacturing disruptions.

Foxconn, headquartered in New Taipei City, Taiwan, has been trying to rebuild its workforce after the massive walkout in late October. The company then ended up apologizing after a pay dispute triggered protests by workers who said Foxconn had changed the terms of wages offered to attract them to the factory.

In its announcement, the company said it would no longer provide free meals to workers because factory cafeterias would reopen. Instead, meal expenses will be deducted from employees’ wages as usual, though workers who must quarantine after testing positive for the virus will still get free meals.

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iPhone November Shipments to See Further Decline at Foxconn’s Plant in China

Foxconn’s flagship iPhone plant in China is set to see a further reduction in November shipments after the latest bout of worker unrest this week, a source with direct knowledge of the matter said on Friday, as thousands of employees quit.

The world’s largest Apple iPhone factory has been grappling with strict COVID-19 restrictions that have fuelled discontent among workers and disrupted production ahead of Christmas and January’s Lunar New Year holiday, as many workers were either put into isolation or fled the plant.

Following Wednesday’s escalation that saw workers clash with security personnel, Foxconn could now see more than 30 percent of the site’s November production affected, up from an internal estimate of up to 30 percent when the labour issues erupted in late October, the source said.

The factory is the only one that makes premium iPhone models, including the iPhone 14 Pro, and the source said it is unlikely to resume full production by the end of this month.

Foxconn, formally known as Hon Hai Precision Industry, declined to comment. Apple, which said on Thursday it had staff at the factory, did not respond to a request for comment on Friday.

“The worker unrest at Foxconn’s plant in China could weigh on Apple’s November iPhone shipments,” Victoria Scholar, head of investment at Interactive Investor said, as concerns grow over Apple’s ability to deliver products for the busy holiday period.

Apple shares were down 1.9 percent in late morning trade on Friday, while the benchmark Nasdaq index was down 0.3 percent.

“Apple is still viewed as one of the more resilient stocks in the tech sector… However, Apple continues to hold off from providing official guidance given the macroeconomic uncertainty,” Scholar added.

US Best Buy said on Tuesday it expected high-end iPhones to be in short supply at stores this holiday season. Analysts said iPhones at Apple stores in the United States during the Black Friday shopping season were also down from a year earlier, and it was taking longer to replenish stocks, Reuters reported this week.

Lower Shipments

KGI Securities analyst Christine Wang said if the current issue lasts through December, around 10 million units of iPhone production will be lost, which translates to 12 percent lower iPhone shipment in the last quarter of 2022.

Wedbush Securities estimates many Apple stores now have 25 percent to 30 percent fewer iPhone 14 Pros than normal heading into the holiday shopping season.

In a statement on November 7, Apple said it expected lower iPhone 14 Pro and iPhone 14 Pro Max shipments than previously anticipated.

Some new recruits hired in recent weeks by Foxconn claimed they were misled over compensation benefits at the factory, and others complained about sharing dormitories with colleagues who had tested positive for COVID.

Foxconn on Thursday apologised for a pay-related “technical error” when hiring and later offered CNY 10,000 (nearly Rs. 1,14,000) to protesting new recruits who agreed to resign and leave.

The source said more than 20,000 workers, mostly new hires not yet working on production lines, took the money and left. Videos posted on Chinese social media on Friday showed crowds and long lines of luggage-laden workers queuing for buses.

“It’s time to go home,” one person posted.

The plant, before its troubles began, employed more than 2,00,000 staff. It has dormitories, restaurants, basketball courts and a football pitch across its sprawling roughly 1.4 million-square-metre (15 million-square-foot) facility.

Another Foxconn source familiar with the matter said some new hires had left the campus but did not elaborate on how many. This person said that because the people leaving had not yet been trained or begun to work, their departures would not cause further harm to current production.

“The incident has a big impact on our public image but little on our (current) capacity. Our current capacity is not affected,” the source said.

“There’s only so much corporate can do on pandemic prevention… It’s been a problem for a while. This is a problem faced by everyone,” the person said, pointing to other worker unrest triggered by rigid COVID restrictions, including upheaval at another Apple supplier, Quanta, in May.

Foxconn shares closed down 0.5 percent, lagging the broader market, which ended flat.

© Thomson Reuters 2022

 

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iPhone Factory Workers’ Protest: Over 20,000 New Hires Said to Leave Foxconn’s Zhengzhou Plant

More than 20,000 employees, most of them were new hires not yet working on the production line, have left Apple supplier Foxconn’s Zhengzhou plant in China, a Foxconn source familiar with the matter told Reuters on Friday. The person said the departures would complicate the company’s previous target of resuming full production by the end of November, following worker unrest that rocked production at the world’s largest iPhone factory.

Foxconn declined to comment. The worker departures come after the Taiwanese firm offered on Thursday CNY 10,000 (roughly Rs. 1,14,000) to employees who wanted to resign and leave the chaos-hit plant.

It had apologised for committing a pay-related “technical error” when hiring new recruits, which workers say was a factor that led to protests involving clashes with security personnel.

Videos posted on Chinese social media on Friday showed crowds and long lines of luggage-laden workers queuing for buses. “It’s time to go home,” said one of the posters.

The labour unrest at the Zhengzhou plant that began on Wednesday marked rare scenes of open dissent in China which workers say was fuelled claims of overdue pay and frustration over severe COVID-19 restrictions.

A second Foxconn source familiar with the matter said some new hires had left the campus but did not elaborate on how many. The person said the departures had no impact on current production, as the new staff still needed to take training courses before working online.

The unrest comes at a time when China is logging record numbers of COVID-19 infections and grappling with more and more lockdowns that have fuelled frustration among citizens across the country. But it has also exposed communication problems and a mistrust of Foxconn management among some staff.

Foxconn launched a hiring drive earlier this month promising bonuses and higher salaries after it had to enact measures to curb the spread of COVID-19 in October. The curbs forced the company to isolate many employees and the plant’s conditions prompted several to flee.

© Thomson Reuters 2022

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iPhone November Shipments Said to See 30 Percent Slash Due to COVID-19 Woes in Foxconn China Plant

Apple supplier Foxconn’s COVID-19 woes at its vast iPhone manufacturing facility in China’s Zhengzhou city could slash the site’s November iPhone shipments by up to 30 percent, a source with direct knowledge of the matter said.

The source, who declined to be identified as the information was private, said Foxconn is working to boost iPhone production at its factory in the southern city of Shenzhen.

Foxconn referred Reuters to a statement it released late on Sunday, in which the company said that the situation was gradually being brought under control and that Foxconn would coordinate back-up production capacity with its other plants to reduce any potential impact.

Apple did not immediately respond to a request from Reuters for comment. Shares of Foxconn, formally called Hon Hai Precision Industry Company Limited, dropped 1.9 percent on Monday morning, compared to a 1.1 percent rise in the broader market.

Foxconn’s factory in Zhengzhou assembles the majority of the company’s global iPhone output, though Apple also produces the product in southern China as well as in India.

The plant, which employs about 200,000 workers, has in recent days been rocked by worker discontent over stringent measures to curb COVID-19 within the site.

Several migrant workers fled the plant over the weekend for their hometowns, driving cities to hastily draw up plans to accommodate them.

The impact on production comes amid the traditionally busy time for electronics makers and ahead of the year-end holiday season, which is also a prime time for vendors such as Apple.

Under China’s ultra-strict zero-COVID policies, localities are mandated to act swiftly to quell any outbreaks, with measures that could include full-scale lockdowns. On October 19, Foxconn banned all dining-in at canteens and required workers to take their meals in their dormitories, but said that production was normal.

Photographs and videos circulating widely on Chinese social media since Saturday showed Foxconn workers trekking across fields in the day and along roads at night. Reuters could not immediately verify the authenticity of the posts.

© Thomson Reuters 2022

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Government May Clear Semiconductor Unit Proposals in Next 30-60 Days: MoS IT

The government is likely to start approving proposals to set up electronic chip and display manufacturing plants in the country in next 30-60 days, Minister of State for Electronics and IT Rajeev Chandrasekhar said on Wednesday.

Speaking at IESA Vision Summit, Chandrasekhar said there has been a tremendous progress in the development of the semiconductor ecosystem in the country in the last 8-9 months.

The government has received proposals from five companies for setting up electronic chip and display manufacturing plants with investment of Rs. 1.53 lakh crore.

Vedanta Foxconn JV, IGSS Ventures, ISMC propose to set up electronic chip manufacturing plants with $13.6 billion (nearly Rs. 1,11,800) investment and have sought support of $5.6 billion (nearly Rs. 46,000 crore) from the Centre under the Rs. 76,000 crore Semicon India Programme.

“Over the next couple of months, I think over next 30 to 60 days… Government of India and India Semiconductor Mission will be rolling out those proposals that have been scrutinized and that have passed the investment,” Chandrasekhar said in his virtual address at the summit.

He said a great deal of interest is there in the industry and there are several proposals ranging from investment in wafer fabrication plants to silicon compounds to packaging and testing.

“State governments have shown some tremendous amount of alacrity. State governments like Gujarat, Karnataka have shown tremendous proactive response to looking at this very new opportunity, an opportunity for growth, and job creation, investments and innovation,” Chandrasekhar said.

Vedanta Foxconn JV has announced plans to set up an electronic chip manufacturing unit in Gujarat. He said there is significant investment required in the semiconductor space and the government is looking at this sector as a long game.

“This year alone, we will cross over $15 billion (nearly Rs. 1,23,300 crore) of exports where at one point we were having zero exports in 2014. Our target for electronics as an overall sector is $300 billion (nearly Rs. 24,66,800 crore) of manufacturing by 2025 and exports of $120 billion (nearly Rs. 9,86,700 crore),” Chandrasekhar said.

Citing a study, India Electronics and Semiconductor Association (IESA) Chairman Vivek Tyagi said India will consume roughly $27 billion (nearly Rs. 2,22,000) worth semiconductors in 2022.

He said the government’s incentives have given a push to the electronics sector but most of the products are getting assembled in India.

“Once the products get designed here…there will be a different level of value addition that will happen in the country ,” Tyagi said.

He said before the start of semiconductor manufacturing there is a strong case of assembly and testing of electronic chips in India.

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