Foxconn to shift some Apple production to contain costs after drastic wage hikes

“Foxconn is preparing to shift part of its production of Apple gadgets from Shenzhen to north and central China, amid a greater willingness from the US company to work with factories away from its long-time Chinese hub,” Kathrin Hille reports for The Financial Times.

“The move, aimed at containing costs, follows drastic wage rises for large parts of the workforce of the Taiwanese-owned company, after a string of worker suicides and widening labour unrest,” Hille reports.

“Apple is Foxconn’s biggest customer,” Hille reports. “Any move by Foxconn will add to momentum to the gradual diversification of global technology production away from a handful of locations in southern China and around Shanghai.”

“Executives close to the annual negotiations between the two companies over next year’s orders said Foxconn’s demands to pass on some higher labour costs had not been met favourably by Apple,” Hille reports. “‘But Apple is more ready now to use some of the new locations,’ one executive said.”

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