The Taiwanese group Foxconn, whose Chinese factory is confined due to an outbreak of Covid, is the largest iPhone manufacturer in the world, of which it provides 70% of global production. The factory operates in a closed circuit with employees having to sleep on site.
Here are five things to know about this company, also known as Hon Hai Technology Group, which is one of the largest employers on the planet, with nearly 1.3 million employees.
1. Personal success story
Behind the story of Foxconn, a man: Terry Gou, who started in 1974 by manufacturing television spare parts. His parents had fled communist China after the civil war. He will then build an empire, becoming the richest man in Taiwan (last year, he was still 6th), a rise which is a reflection of the economic successes of the island.
Known for his aggressive style in business, he managed to obtain billions of dollars in public funding to grow his group, which became the main subcontractor for the American giant Apple. He handed over the reins in 2019 to a committee, in order to pursue his new dream, political this time: that of running for the presidency of Taiwan.
2. Wave of suicides
Working conditions at Foxconn have caused scandal in the past, notably during a wave of suicides in its Chinese factories in 2010, which forced the group’s founder to review his harsh management methods. But his response baffled. The setting up of “suicide nets” to catch workers throwing themselves from the top of factories has become a symbol of the high price paid by Chinese workers in China’s rapid economic rise.
During the pandemic, the company has also been accused of forcing sick employees to work, without providing medical treatment or enough meals. Foxconn assured Sunday “to do everything possible” to take care of the employees.
3. The impact of Covid
The factory in Zhenzhou, central China, makes the majority of the world’s iPhones, with tens of thousands of employees living there year-round. Most only go home on vacation.
Since the release of the first iPhone in 2007, the group has opened factories in six other Chinese cities, producing Kindles for Amazon, game consoles for Nintendo and Sony and phones for Google.
On Wednesday, the Chinese authorities confined the 600,000 people living around the Zhengzhou site for a week, after the discovery of a Covid outbreak in mid-October which caused a large number of employees to flee. Production in China has already been disrupted on several occasions by the zero Covid policy imposed in the country, forcing factories to be confined as soon as cases appear.
4. Beijing-Washington tensions
Foxconn has also suffered from growing tensions between the United States and China, amid technological rivalry. When in 2018 Terry Gou and then-US President Donald Trump jointly opened a $10 billion electronics factory in Wisconsin, Beijing saw it as a gesture of appeasement between the two countries. But the project was ultimately disappointing, with a more modest factory and less job provider than expected.
And a controversy has erupted over the large tax breaks Foxconn received from the US government to set up shop.
5. Global presence
Present mainly in China, Foxconn has sought to diversify geographically in recent years. In 2016, it bought the Japanese Sharp, and today the group has factories in ten countries including Vietnam, Slovakia, Hungary, the Czech Republic, Brazil, Mexico and the United States.
The company has also varied its activities and is now present in semiconductors, robots, health, as well as in electric vehicles, of which it hopes to capture 5% of the world market in 2025. In 2021, it generated a revenue of $214.8 billion, up 10.9% year-on-year.
Here are five things to know about this company, also known as Hon Hai Technology Group, which is one of the largest employers on the planet, with nearly 1.3 million employees.1. Personal success storyBehind the history of Foxconn, a man: Terry Gou, who started in 1974 by manufacturing television spare parts. His parents had fled communist China after the civil war. He would then build an empire, becoming the richest man in Taiwan (last year he was still 6th), a rise that is a reflection of the economic successes of the island. Known for his aggressive style in business, he managed to obtain billions of dollars in public funding to grow his group, which has become the main subcontractor of the American giant Apple. He handed over the reins in 2019 to a committee, in order to pursue his new dream, political this time: that of running for the presidency of Taiwan. Wave of suicidesWorking conditions at Foxconn have caused scandal in the past, notably during a wave of suicides in its Chinese factories in 2010, which forced the group’s founder to review his harsh management methods. But his response baffled. The setting up of “suicide nets” to catch workers throwing themselves from the top of factories has become a symbol of the high price paid by Chinese workers in China’s rapid economic rise. During the pandemic, the company was also accused of forcing sick employees to work, without providing medical treatment or sufficient meals. Foxconn assured Sunday “do everything possible” to take care of employees.3. The impact of Covid The factory in Zhenzhou, in central China, manufactures the majority of iPhones in the world, with tens of thousands of employees living on site year-round. Most only go home on vacation. Since the release of the first iPhone in 2007, the group has opened factories in six other Chinese cities, producing Kindles for Amazon, game consoles for Nintendo and Sony and telephones for Google. On Wednesday, the Chinese authorities confined the 600,000 people living around the Zhengzhou site for a week, after the discovery of a Covid outbreak in mid-October which caused a large number of employees to flee. Production in China has already been disrupted on several occasions by the zero Covid policy imposed in the country, forcing factories to be confined as soon as cases appear.4. Beijing-Washington tensionsFoxconn has also suffered from growing tensions between the United States and China, amid technological rivalry. When in 2018 Terry Gou and then-US President Donald Trump jointly opened a $10 billion electronics factory in Wisconsin, Beijing saw it as a gesture of appeasement between the two countries. But the project ended up disappointing, with a smaller factory and less job provider than expected. And a controversy erupted over the significant tax breaks Foxconn received from the US government to set up. Global presence Present mainly in China, Foxconn has sought to diversify geographically in recent years. In 2016, it bought the Japanese Sharp, and today the group has factories in ten countries including Vietnam, Slovakia, Hungary, the Czech Republic, Brazil, Mexico and the United States. has also varied its activities and is now present in semiconductors, robots, health, as well as in electric vehicles, of which it hopes to capture 5% of the world market in 2025. In 2021, it generated a turnover of business of $214.8 billion, up 10.9% year on year.
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