Beta
×

Welcome to the Slashdot Beta site -- learn more here. Use the link in the footer or click here to return to the Classic version of Slashdot.

Thank you!

Before you choose to head back to the Classic look of the site, we'd appreciate it if you share your thoughts on the Beta; your feedback is what drives our ongoing development.

Beta is different and we value you taking the time to try it out. Please take a look at the changes we've made in Beta and  learn more about it. Thanks for reading, and for making the site better!

Foxconn International Removed From Hang Seng Index

timothy posted more than 3 years ago | from the see-fellas-there's-this-thing-called-goodwill dept.

China 91

Tasha26 writes "After the suicides and fatal explosion, the Taiwanese company Foxconn now faces losing its blue-chip status. Falling prices for smartphones, laptops, tablets and other gadgets and rising wages in China have undermined Foxconn's financial performance. The company lost $220m (£135m) in 2010. Foxconn International will be removed from Hong Kong's benchmark Hang Seng index and be replaced by insurer AIA and nappy maker Hengan. The two new entrants use China both as a source of cheap labour and as a market for their product, a switch which Foxconn is now considering."

cancel ×

91 comments

Sorry! There are no comments related to the filter you selected.

hahahaha (0)

Anonymous Coward | more than 3 years ago | (#36362364)

hahaha

Great...? (2)

Lunix Nutcase (1092239) | more than 3 years ago | (#36362388)

The two new entrants use China both as a source of cheap labour and as a market for their product

They sound like fine, upstanding companies! Oh wait... So basically they just replaced one exploitative company with two more!

Re:Great...? (3, Interesting)

TheRaven64 (641858) | more than 3 years ago | (#36362420)

The second is the more important part. Foxconn uses China as a source for cheap labour, but focusses on exporting their products. The fact that this is a failing business model is interesting, since it shows that China needs the west a lot less than you might have thought - companies that make things in China and sell in the USA are failing relative to companies that make things in China and sell them in China.

Re:Great...? (2)

eln (21727) | more than 3 years ago | (#36362642)

China's middle class is exploding, so there are markets there that didn't exist only a few years ago. Ironically, one of the hurdles for Chinese companies to overcome is that many middle class Chinese seek out American (or otherwise foreign) products because they believe Chinese products are largely shoddy knockoffs. This means that, at least for now, most Chinese manufacturers are only able to successfully sell to the wealthier parts of the Chinese market by doing outsourced manufacturing work for an American brand.

Of course, as Chinese companies absorb more knowledge of how to market their own brands (they're already learning about quality control from the demands of the American brands outsourcing manufacturing to them), those brands will gain strength. At that point, they won't need American brands to sell to their own country, and can cut out the middleman. Eventually, those strong Chinese brands will make their way here and compete directly with American brands on our own shores. This is a matter of when, not if.

This has always been a major problem with outsourcing. It's basically impossible to outsource any significant work without at the same time training your outsourcing partner in the skills they would need to directly compete with you if they so desired. With the Chinese domestic market exploding, there are huge opportunities for Chinese companies who are willing and able to step out from the shadow of their American outsourcing partners.

Re:Great...? (2)

Moridineas (213502) | more than 3 years ago | (#36362754)

This has been true for a long time.

I once met someone who had been a manager at Bell Labs back in halcyon days. He had spent a good bit of his career in China, Japan, and Korea.

He said that when working in China, the Chinese made no bones about copying what Ma Bell was doing. He said at one point the Chinese govt (or some corporate proxy) had rented a floor in the building where AT&T had offices, and were completely conspicuous about breaking in, stealing data, planting moles. He was baffled as to why AT&T continued to do business there...

It baffles me to too... why so many American and European companies are so willing to quicken their demise for a few bucks today. On the other hand--and this is already happening--China is getting more expensive, labor codes are finally being updated, and the environment is no longer being quite so blatantly shat upon. Maybe we'll see some offshoring back to the US with shipping costs being what they are.

Re:Great...? (1)

Exitar (809068) | more than 3 years ago | (#36362864)

He said at one point the Chinese govt (or some corporate proxy) had rented a floor in the building where AT&T had offices, and were completely conspicuous about breaking in, stealing data, planting moles. He was baffled as to why AT&T continued to do business there...

I'm more baffled by the fact they didn't hire some guards (non local, just to be sure) to prevent that.

not going to help (1)

fireylord (1074571) | more than 3 years ago | (#36365526)

I'm sure that the chinese government backed goons doing the break-ins could have bribed/intimidated the guards enough to let them in anyway, and probably help cover their tracks somewhat

Re:Great...? (1)

tlhIngan (30335) | more than 3 years ago | (#36363746)

It baffles me to too... why so many American and European companies are so willing to quicken their demise for a few bucks today.

Blame the short-term shareholder. The guy who wants results today, screw tomorrow. $1 today is worth much more than $2 tomorrow. Basically get-rich-quick investors who want to hold onto an investment just to make a buck and sell it after they have.

Take a look at share prices around earning report time - the usually start rising just after the quarter ends then what happens after that is up to the earnings report. Even if they meet their expected earnings, if they fail to meet analyst's expected earnings (even if they're completely ludicrous), the share price can drop 5% or more easily.

Execs (CxOs, board members) get major compensation via stock as well, so it encourages them to pump up the stock price and sell off shares when they can. "The Future" is a problem for the CEO's successor, and if things ar elooking bleak, expect the CEO to suddenly resign and dump their stock.

Maybe if instead of instant compensation execs had to hold all their stock-based (and option-based) compensation beyond their term. It's their bonus anyways, and maybe if they had to hold it for 5 years after they leave, they would consider the longer-term survival and health since their bonus pay only comes years later. Also helps ensure they pick a good leadership.

Re:Great...? (1)

NeutronCowboy (896098) | more than 3 years ago | (#36365188)

Maybe we'll see some offshoring back to the US with shipping costs being what they are.

It's already happening. I unfortunately don't remember which company exactly, but quite a few US manufacturing companies are heading back to the US for their manufacturing facilities. Guess where they're relocating though? The South, which has few to no unions and state governments falling over each other to provide tax breaks.

Re:Great...? (1)

Moridineas (213502) | more than 3 years ago | (#36383056)

I live in the south. It's not just internationals resourcing here, but internal economic refugees. In one of the cities adjacent to where I live, I think roughly 40% of the population is from New York and New Jersey. It's rare to find actual southerners around in a lot of city centers and towns in some places!

The bad news is the refugees tend to bring their politics with them (though they do tend to be less extreme than those who chose to stay) and thus the cycles repeat.

it's not really baffling. (1)

decora (1710862) | more than 3 years ago | (#36368146)

the CEO and top executives get the bucks today, and they get golden parachutes tomorrow. it is not really any of their problem if the entire company goes down the toilet.

it is very much what happened in the financial crisis - CEOs like Dick Fuld of Lehman brothers walked away with hundreds of millions of dollars. He lost a lot of money personally, but he is not wondering where his next meal will come from.

There are thousands if not tens of thousands of lower level executives, hedge fund people, etc, who did the same thing. Ramp up the CDO business, get rich quick, retire, and let the rest of society fend for itself.

Re:Great...? (1)

smelch (1988698) | more than 3 years ago | (#36364200)

Yeah, see, its almost like corporations are "outsourcing" and turning desolate pieces of country in to industrialized ones that can compete in the marketplace while democrats bitch and moan about exploiting people and greedy corporate elitists. Who is it that is really greedy?

Re:Great...? (1)

jandrese (485) | more than 3 years ago | (#36364170)

I think the fact that their business model is failing has more to do with their extremely aggressive push to offer the lowest possible prices than anything else. Basically, they undercut themselves in an effort to get all of those big contracts we hear so much about. In other words, their problems stem more from their management practices than from socioeconomic factors.

Re:Great...? (1)

sesshomaru (173381) | more than 3 years ago | (#36364862)

"The fact that this is a failing business model is interesting, since it shows that China needs the west a lot less than you might have thought - companies that make things in China and sell in the USA are failing relative to companies that make things in China and sell them in China."

Brrr... it's a good thing I have friends in Shanghai.

Re:Great...? (1)

RManning (544016) | more than 3 years ago | (#36366544)

The second is the more important part. Foxconn uses China as a source for cheap labour, but focusses on exporting their products. The fact that this is a failing business model is interesting, since it shows that China needs the west a lot less than you might have thought - companies that make things in China and sell in the USA are failing relative to companies that make things in China and sell them in China.

Or it could be because of a thousand other reasons, or more likely a combination of a lot of factors.

Re:Great...? (1)

couchslug (175151) | more than 3 years ago | (#36362426)

"h wait... So basically they just replaced one exploitative company with two more!"

Do note that Chinese have NEVER been better off, and that this is a _perfectly_normal_transitional_stage for developing nations. You take casualties in economic competition just like any other war.

I'd rather pull long hours at a Foxconn plant than go to an early grave working in a US textile plant or coal mine decades ago. China has come a LONG way since 1948. That's a very short time in economic development terms.

Re:Great...? (2)

M. Baranczak (726671) | more than 3 years ago | (#36362520)

I'd rather pull long hours at a Foxconn plant than go to an early grave working in a US textile plant or coal mine decades ago.

http://c2.com/cgi/wiki?FalseDichotomy [c2.com]

Re:Great...? (1)

grimsweep (578372) | more than 3 years ago | (#36362678)

The original poster's sentence isn't a dichotomy. There's no implicit statement that working in any of the jobs listed are the only options; the poster is simply expressing a personal opinion via a comparison.

http://www.wisegeek.com/what-is-a-dichotomy.htm [wisegeek.com]

Re:Great...? (2)

M. Baranczak (726671) | more than 3 years ago | (#36363606)

Yes, it is. When you express a preference for one of two states, and completely fail to acknowledge that there are other possible states, you are implicitly presenting a dichotomy.

In this case, the state that's being ignored is one in which companies are able to make products and workers are treated like human beings. You can argue why it can't happen, or why workers don't deserve to be treated like human beings, but ignoring it is a dishonest tactic.

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36366168)

Man, you must be a BLAST at restaurants. God forbid someone ask "what's good here" and the waitress fails to rank every last dish from best to worst.

Re:Great...? (1)

marnues (906739) | more than 3 years ago | (#36367346)

It isn't ignored at all. You completely missed couchslug's point. He listed 3 real jobs that are comparable in a socioeconomic sense. Of course we all want a good job with intelligent and responsible management, but how about we stick to the discuss instead of bringing up random tangents?

Re:Great...? (4, Insightful)

eepok (545733) | more than 3 years ago | (#36362594)

Oddly enough, this is historically correct. I'd mod you up if I had points.

It doesn't make it right or good, but regions (not nations) have been shown to go through industrial and economic changes in roughly the same pattern:

1) Dominance/Slavery/Colonialism
2) Once dominance becomes too unsavory or colonialism becomes too dangerous, enter "Exploitative Industrialism" (China is here.)
3) Once wealth has been spread sufficiently to empower the majority, reliable Workers' Rights comes in.
4) After Workers' Rights prevents the exploitation of local labor, companies find international sources of labor to exploit. (The "1st World" is here.)
5) ??? We're all hoping this will be "Automation becomes main labor source and the profits are shared with those that would otherwise be working in the form of social welfare and education..." but it will likely be "Automation makes things ever more profitable, people laid off, economy slides because no one has income, company fails."

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36362704)

6) programmers rule the world!

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36362744)

#5 is the stage where we need to rethink our concept of value and money.

Re:Great...? (1)

Machtyn (759119) | more than 3 years ago | (#36363586)

Or, to put it more concisely, wealth. Is it so necessary that one person have more than another? Unfortunately, some people think it is. Also, due to human tendencies, the ability of a single person or group to delegate who should have what will always be an utter failure - see USSR.

If wealth is nullified and everyone is to receive equally in food, necessities, and entertainment, then the people receiving the items must be willing to perform their duties for the improvement of society. Some FLOSS projects are a good example of people doing something for the sole purpose of societal improvement.

The problem is that some people feel they deserve more than another person. And others have no pride in their work (if I don't expect to get any more or less than what I currently get, why should I work harder, better, more efficiently?)

Re:Great...? (1)

denzacar (181829) | more than 3 years ago | (#36364840)

If wealth is nullified and everyone is to receive equally in food, necessities, and entertainment, then the people receiving the items must be willing to perform their duties for the improvement of society.

No need to "nullify wealth". Just have it distributed more equally. [wikipedia.org]

And it is not that anyone MUST be willing to work for the improvement of the society - it's that many would then be FREE to do so.

Re:Great...? (1)

jonathansdt (1176719) | more than 3 years ago | (#36363444)

5 is the stage where the lower class is no longer needed, which creates instability and unrest, which leads to revolution, which kills all the smarties, redistributes the wealth, back to Stage 3.

Re:Great...? (3, Insightful)

scamper_22 (1073470) | more than 3 years ago | (#36363480)

I work with computers all day.
I often wonder what people think computers are all about.

They're all about replacing human labor. I find it odd working in this field and talking to people outside it.

People outside the field seem to think that every age has a 'new economy' but everything else stays the same... as if nothing has changed in history. So they talk as if the 'green' economy will provide everyone with jobs... just 'green' jobs. Or they think we'll all be doing analytical work.

The problem is typically these people lack an understanding of scale. It's odd how so many academics lack an understanding of scale as well. All the 'good' jobs of the future are jobs that do not scale with the population. They are for small groups of highly skilled people.

So Google can do all it does with a mere 30K people or so. That is enough to serve the whole world. Just to put it in context. BlockBuster employed 60K people and it represents just a sliver of what Google can do (content delivery).

The single biggest problem is that the private sector is increasingly not scaling with population. Small highly efficient operations are there.

The public sector typically does scale with population. More nurses, doctors, police officers, teachers... are needed as the population grows. Now we can certainly try and automate parts of these jobs (online class delivery...), but in general we're not there technologically or the unions won't allow it.

So we have a structural imbalance. The only way out of it... is to go to the start... computers are doing what they were meant to do... kill human labor. We should all be working less... job sharing. the result is a much more egalitarian society... with potentially a very rich upper class at the top of some of the automation companies.

However that would kill people's position of privilege in society. Public sector workers expect a premium over the average person. Ditto for bankers...

IMHO, we need to embrace deflation and the lack of work and redirect people to the jobs that still need doing. Maybe we need vast numbers of people to work on the farms 2 weeks a year. Other need to go mine for rechargeable batteries.

One of the biggest problem we still face is the emphasis on 'educated' labor. Just as the industrial revolution automated manufacturing jobs. The information revolution automates so much educated labor. We need a few experts, but computing can do the rest.

So we need to get rid of the idea that just because you're educated, you should be paid more. Most of the legal and financial jobs are unproductive today. Just there to keep educated people in a premium position over society. We could for example automate and simplify the entire tax field and get rid of most accountants.

But as I said, people are used to their position of privilege. Egalitarianism is a hard concept... even though people talk about it. When people talk about good jobs, they mean jobs better than someone else.

It's definitely going to be a rough time... especially since technology is deflationary... but governments and banks are inflationary. We certainly can't embrace deflation as governments have so much debt and banks are dependent on people taking loans... and guess who is in charge of most countries (bankers and governments...)

Expect a rough time.

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36363808)

It's nice to see someone with a grasp on reality. How does everyone else not see it...

Re:Great...? (1)

scamper_22 (1073470) | more than 3 years ago | (#36364392)

I have no idea. I've got my home, my family... that's all I can care about right now. I gave up on political understandings a long time ago. We're no smarter than the Germans or the Chinese or any of the other people who went through crazy political experiments.

My hunch, we'll go through more crazy political experiments before it all comes crashing down.

Re:Great...? (1)

sjames (1099) | more than 3 years ago | (#36379458)

What we need to get rid of is any concept that the economy is anything but a construct of man that should serve all people within it.

If it doesn't do the moral and just thing, then it is broken and must be fixed.

Apparently, in the U.S. there isn't enough work that needs doing to occupy the entire adult population 5 days a week 8 hours a day. That COULD be a very good thing except that we insist on a bizarre all or nothing scheme for employment. Perhaps we should go to a 30 hour week and employ the unemployed to take up the slack. With any luck, our improving automation will let us scale back to 20 hour weeks before too long.

In 100 years, we will either collapse entirely or there will be school children asking their teachers how people 100 years ago could be so stupid.

Re:Great...? (1)

uninformedLuddite (1334899) | more than 3 years ago | (#36381988)

Expect a rough time.

The solution to what you write above is very simple. The word is cull. It won't be computers that will be culled. It will be us. Maybe I have a waped view of what the future entails but I don't think I do. I actually hope I am wrong.

Re:Great...? (1)

Richard Dick Head (803293) | more than 3 years ago | (#36363568)

No, automation meets the first step.

It is far easier to automate the gamut of tasks that a person with a <100 IQ can do, versus a person with >100 IQ. The former will be automated out of the picture, and therefore will be ridiculously cheap. We're going back to the good old days when your average middle-classman could afford a maid, a butler, a city home, and a country home.

Re:Great...? (1)

hackingbear (988354) | more than 3 years ago | (#36363620)

#5 is also known as Communism. As I grew up in China, I remember the teaching in the middle school political science class was that Marx claimed the very advanced capitalistic society would adopt communism successfully. I don't know if Marx had actually said the same, but the theory is certainly used to justify the extreme capitalistic economic reform since the 1980's without changing the political brand name. At the time, I doubted this theory, partially because nobody believed whatever the government said.

But after living in the US for a long time and comparing to what have happened in Western Europe, this theory may be right. It is not whether you like it or not, it may be inevitable. Most likely, we will stick to capitalism in names but practicing more and more communism. The tea party thing is only transient phenomena, whether you like it or not.

Re:Great...? (1)

hackingbear (988354) | more than 3 years ago | (#36363654)

Clarification: I meant this part ""Automation becomes main labor source and the profits are shared with those that would otherwise be working in the form of social welfare and education..." of the #5, not the second part. The second part cannot be sustained because it will lead to revolution -- it is probably the final stage of advanced capitalism.

Re:Great...? (1)

RewriteQuran (1943392) | more than 3 years ago | (#36371870)

India is developing since you can exploit their people via caste system.
http://goo.gl/w8QpF [goo.gl]
China is developing since you can exploit their people by abusing human rights.
http://goo.gl/8wiUq [goo.gl]

Americans are suffering since US regime is letting Chindia exploit their people via outsourcing.
US visa system/outsourcing should be linked to caste system in India and human rights in China

how about a chinese coal mine today? (1)

decora (1710862) | more than 3 years ago | (#36368170)

they have one of the worst safety records in the history of coal mining, and if you talk about it you get put in a labor camp

hell, they just imprisoned a guy who ran a website about the poisoned baby-milk scandal. Zhao Lianhai.

Re:Great...? (1)

Missing.Matter (1845576) | more than 3 years ago | (#36362452)

FTFA: "Both companies target China as a market for their products rather than as a place to make goods cheaply for export."

Re:Great...? (1)

whiteboy86 (1930018) | more than 3 years ago | (#36362538)

They are 'exploiting' the labor because the happy socialist regime allows this to happen. If there was a sensible minimal wage law a Yuan equivalent of say $10000/year then this would suddenly stop and Apple would be forced to finally automate the manufacturing and even bring it back home.

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36362596)

So you're saying that all China needs to do is implement minimum wage laws, in order to drive industry out of their country? I'm sure they're eager to start. They can use the U.S. as a model.

Re:Great...? (1)

cyfer2000 (548592) | more than 3 years ago | (#36363310)

There is a minimum wage law in China. The minimal wage required by law at Foxconn's Guangdong is a little bit less than $2 per hour, and the minimal wage at Chengdu plant is about $1 per hour.

Re:Great...? (1)

vijayiyer (728590) | more than 3 years ago | (#36362612)

You illustrated in your own post why this doesn't work. Companies leave, there is no job, and suddenly the people are worse off.
You haven't been to China if you think you need $10000 as a living wage.

Re:Great...? (1)

ewieling (90662) | more than 3 years ago | (#36362846)

USA Federal min wage works out to be $15,080/yr. I would not call that a "living wage". Not in the USA.

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36364696)

Except the subjects of the discussion in fact don't live in the USA, they live in China, where everything is much, much cheaper.

Re:Great...? (2)

Thud457 (234763) | more than 3 years ago | (#36365008)

in China, where everything is much, much cheaper.

But the lead is adulterated with melamine and the melamine is contaminated with lead.

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36365228)

That depends on where you live.

A friend of mine bought a house about 5 years ago. His mortgage? 80 bucks a month. Yes you read that correctly. He even for a lark got a 20 year (they wouldnt let him go higher). Was it a nice house? No. Was it near all the cool stuff? No. However, you could live decently for that in that small town. He lived pretty good making 5x that. All the cool toys. Tons of friends. Just had to drive 2-3 hours to get to the closest best buy... 45 mins to the closest walmart. Yeah it was next to the middle of nowhere. But he enjoyed it and the USPS delivers (or a small 1 block walk away if they wont). But he got lonely and he wanted to move closer to work (1 hour drive).

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36382254)

USA Federal min wage works out to be $15,080/yr. I would not call that a "living wage". Not in the USA.

It's simple, there is too great a concentration of wealth amongst too few individuals in America. Sure, a wealthy individual can support sectors of the economy that require large purchases, but they will not be able to support the majority of sectors which depend on myriad individuals making many small purchases.

E.g.: Health care. It doesn't really matter how rich you are, you're only going to buy one health insurance plan. Food. It doesn't matter how rich you are, you're only going to buy enough food to eat extravagantly, which is a tiny amount compared to 100,000,000 people eating frugally.

Extraordinarily wealthy people simply can't spend money fast enough to do their part for the economy.

Re:Great...? (1)

eepok (545733) | more than 3 years ago | (#36362620)

I almost agree. If there were a wage increase, Apple (and most other companies) would do their best to find another reliable and exploitable people. If that can't be found, only then would they seek skilled labor to oversee automated operations... but even then, it would be cheaper to run such plants overseas due to taxes, cost of land, cost of skilled labor, etc.

Well, or they could reduce their own profit margins so the product could still be "affordable" to local consumers and be made in the USA. But, really, what company would do that?

Re:Great...? (1)

h4rr4r (612664) | more than 3 years ago | (#36362798)

There is a limit to that game, the nation you want to move labor to has to have infrastructure of a reasonable nature. These days the time between reasonable infrastructure and enough middle class to enact workers rights is getting pretty short. I fully expect the Chinese to be there in the next 20 years, probably less. India is probably going to be shortly there after, and while much of Africa has labor that works for very little infrastructure issue really hinder many of those nations from being used for cheap labor.

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36363226)

There is a limit to that game, the nation you want to move labor to has to have infrastructure of a reasonable nature. These days the time between reasonable infrastructure and enough middle class to enact workers rights is getting pretty short. I fully expect the Chinese to be there in the next 20 years, probably less. India is probably going to be shortly there after, and while much of Africa has labor that works for very little infrastructure issue really hinder many of those nations from being used for cheap labor.

The limit may be closer than you think. It's going to take a lot of capital to get some of those African countries up to speed, and they don't have the massive labor pool (population) that China and India have.

Re:Great...? (1)

Anonymous Coward | more than 3 years ago | (#36363136)

"Well, or they could reduce their own profit margins so the product could still be "affordable" to local consumers and be made in the USA. But, really, what company would do that?"

I worked for ~4 years at a sporting goods company that makes archery products. Every single product is designed, built, powder coated, assembled and packaged right here in the USA, in Kentucky and Idaho. And, the Aluminum is from the USA as well. The price point is slightly higher than the competition, though profits aren't quite as high. All this is done because the owner, who is not a natural born citizen, feels that it is the best way to do things. He also has a love for this country I have a hard time finding in many natural born citizens.

Some people will do this, because they feel it's right.

Re:Great...? (1)

stewbee (1019450) | more than 3 years ago | (#36362774)

Umm, China is officially communist. That little tidbit aside, I will paraphrase Jim Cramer. He says that we can learn a thing or two about capitalism from the Chinese. The leadership in China knows that by keeping labor costs low in addition to keeping their currency artificially low by fixing its value to the dollar, that it can export to many countries. It is part why it is so lucrative for US companies to export the labor and production there.

I think lately that China has allowed its currency's value to vary, but I think that it is still relatively low. Looking at google finance, the current exchange rate is 6.4 yuan to the dollar. This is possibly a double edged sword for them. Sure it allows their exports to look cheap. the down side is that imports are expensive. If any of the products they export are heavily dependent on imports, then this could be why Foxconn is suffering. Are the material required to make the electronic components heavily dependent on imports?

With the fed playing with things like quantitative easing, which reduces the value of the dollar, and with China fixing their value to the dollar, then This is really just helping China more on the relative cheapness of their exports. Although, I know most of Europe called foul and accused the US of doing the same thing as China with the whole QE fiasco. I don't blame Bernake though. I think he is just trying to get the US economy working again.

Re:Great...? (1)

Vaphell (1489021) | more than 3 years ago | (#36363348)

Are the material required to make the electronic components heavily dependent on imports?

have you seen what QEx did to commodity prices? Everybody and their dog uses commodities as a hedge against the inflation thus making producers' life harder.

This is really just helping China more on the relative cheapness of their exports.

there is one major problem with the currency peg for the Chinese. US prints money and doesn't keep it in its borders. Printed money goes abroad to pay for imported stuff, thus exporting the inflation to producer nations. Chinese print yuan to match dollar pool to maintain the peg, so they end up with inflation and to make things worse they have to sit on a huge pile of useless dollars they can't dump without sending the US to the world of pain. They will never be able to redeem anything for these dollars, so in reality they subsidize the US.

Re:Great...? (1)

Lunix Nutcase (1092239) | more than 3 years ago | (#36362788)

Yes, because Apple is the only customer of Foxconn. Wait, pretty much every US electronics company uses Foxconn labor to some amount.

Re:Great...? (1)

AmiMoJo (196126) | more than 3 years ago | (#36362672)

You misunderstand. Foxconn makes products that most Chinese people can't afford so is basically locked out of its home market. I can only make stuff for other companies that sell abroad. These two new companies sell their products in China so as wages (and thus production costs) rise their prices can rise too.

Wage increases cause inflation, but it isn't a problem if the same people earning more are also the ones now able to spend more on your products. Foxconn's problem is that while Chinese wages are going up their customers in other countries are either remaining at the same level or even decreasing their income (since any yearly increase that is less than the rate of inflation is a pay cut).

Re:Great...? (0)

Anonymous Coward | more than 3 years ago | (#36363346)

Foxconn makes products that most Chinese people can't afford so is basically locked out of its home market.

They make laptops. <eyeroll>There are no laptops in China, for sure. </eyeroll>

Re:Great...? (1)

GameboyRMH (1153867) | more than 3 years ago | (#36366350)

Also, they make minor components that can be found in MOST COMPUTERS including mobile devices.

Re:Great...? (1)

Anonymous Coward | more than 3 years ago | (#36363012)

I think you need a lesson in capitalism.
It's not how exploitative the companies are that matters, its how profitable they are.
It could actually be the case that Foxconn aren't exploitative enough!

it's not exploitation (1)

circletimessquare (444983) | more than 3 years ago | (#36363018)

it's certainly better than other options for the poor in china

i always want to ask people who complain about the exploitation of factory workers in poor countries: what's your alternative? go back to the farm and starve?

factories in poor countries are exploitation RELATIVE to standards in the west. but RELATIVE to where these workers are coming from, conditions are BETTER

here, from us history:

http://en.wikipedia.org/wiki/Triangle_Shirtwaist_Factory_fire [wikipedia.org]

this is basically china, today

what came of horrible industrial conditions 100 years ago in the usa? workers agitated for the labor laws we now enjoy in the usa (republican attempts to turn the usa back into a poor country with no worker standards notwithstanding)

what are chinese workers now doing?

http://topics.nytimes.com/top/news/international/countriesandterritories/china/labor-issues/index.html [nytimes.com]

they are asserting their rights, they are agitating for labor laws

this is the way of PROGRESS: you don't move from squalid poor slum to the best conditions in the rich west by snapping your fingers. you climb there, you STRUGGLE. there is no other way

and china is certainly leveraging its industrial might to be as rich as the west, to dominate the west, in a decade or so. it's not exploitation, i'm sorry. it's called progress. chinese workers are busting their ass so their children live by western standards. and that's commendable of them. and some whiny westerner complaining about exploitation is certainly of no use or help to them

Re:it's not exploitation (1)

sjames (1099) | more than 3 years ago | (#36379542)

That climb and struggle is necessary only because we refuse to curb our wealthy properly.

Re:it's not exploitation (1)

circletimessquare (444983) | more than 3 years ago | (#36382908)

i think the wealthy should be curbed. but you still have to struggle. everyone does

Re:Great...? (1)

gl4ss (559668) | more than 3 years ago | (#36363898)

not just exploitative - UNPROFITABLE TOO. i've been wondering about that, it must have cost an arm and leg in mortages to build their sites(build a city on loan money, I don't think apple&others were paying them high enough profit margins for them to pay off all the investments that went into kickstarting their huge drone assembly operation), it will cost a lot to keep the guys there and it costs a lot to keep them entertained or working - and optimizing the workflows doesn't work when you're tied to that labor, or if they do, they reduce the need for that labor(the usa car industry problem that happens every decade it seems).

Who cares how many chinks die (-1)

Anonymous Coward | more than 3 years ago | (#36362392)

I want a new iPhone

Price controls cause shortages (1)

Colin Smith (2679) | more than 3 years ago | (#36362418)

No more iPads.

Guess they better learn to control inflation. The way America did.
 

Re:Price controls cause shortages (1)

thijsh (910751) | more than 3 years ago | (#36362482)

You're kidding right? If China did that we would all be doomed... America's financial and foreign policy (both are closely related) are in no way a good long-term plan.

Re:Price controls cause shortages (1)

Kenja (541830) | more than 3 years ago | (#36362494)

"The way America did."

Where are they going to find a source of cheap labor in another country that they can charge a low 2% trade tariff against like we did?

Re:Price controls cause shortages (1)

TheLink (130905) | more than 3 years ago | (#36363610)

Africa? http://news.bbc.co.uk/2/hi/africa/7086777.stm [bbc.co.uk]
http://www.bloomberg.com/news/2011-02-22/china-s-investment-in-africa-to-increase-to-50-billion-by-2015-bank-says.html [bloomberg.com]

Might be funny if Communist China's investment in Africa actually improves Africa more than all that Western aid.

Re:Price controls cause shortages (1)

OzPeter (195038) | more than 3 years ago | (#36362566)

No more iPads.

You'll just have to do with the pads that Hengan is going to be making.

Nappy? (2, Funny)

stopacop (2042526) | more than 3 years ago | (#36362424)

What the hell is a nappy? I'll ask Don Imus!

Re:Nappy? (1)

ep32g79 (538056) | more than 3 years ago | (#36362438)

For North American readers, a "nappy" is a diaper.

Re:Nappy? (1)

idontgno (624372) | more than 3 years ago | (#36362528)

In the finest slashdot tradition, not only did I not RTFA, I barely skimmed TFS. Somehow, I came to the conclusion that Apple was switching away from Foxconn to Hengan for their manufacturing. This said to me that Apple was tacitly acknowledging that their iProducts were full of crap.

I guess I pretty seriously misread that. It's not really an Apple article at all, which was terribly disappointing.

Re:Nappy? (1)

stopacop (2042526) | more than 3 years ago | (#36362540)

For you tea sipping, hat wearing at royal weddings, Queen worshipping Brits - nappy means that your hair looks really bad. Probably why you Brits wore hats during the wedding

Re:Nappy? (1)

Mashiki (184564) | more than 3 years ago | (#36362622)

That might apply to Americans, and possibly some asian countries. But us Canucks know what they are. You know that whole 'let off the british leash' ~30 years ago when we repatriated.

the canucks have a overhyped shit goalie that was (0)

Anonymous Coward | more than 3 years ago | (#36362888)

the canucks have a overhyped shit goalie that very lucky to get past round 1.

Re:Nappy? (1)

stopacop (2042526) | more than 3 years ago | (#36362934)

Mashiki, LOL @ Canada and the Queen suspending parliament in your country or whatever providence she has power over. Should we just rename Canada to "Western United Kingdom"?

Re:Nappy? (1)

Fibe-Piper (1879824) | more than 3 years ago | (#36363470)

Mashiki, LOL @ Canada and the Queen suspending parliament in your country or whatever providence she has power over. Should we just rename Canada to "Western United Kingdom"?

It wasn't the Queen that prorogued (aka suspended) our Parliment. In Canada it is the Governor General that has the authority to do this and she did. Canada barely requires the Queen's assent for anything any more.

The irony is that one of the only things the Queen has the absolute right to decide is the appointment of the Governor General. But I don't think she has ever gone against the wishes of the Prime Minister's chosen candidate anyway.

Re:Nappy? (1)

Mashiki (184564) | more than 3 years ago | (#36370992)

Pretty much spot on, she hasn't gone against the government. Not since the days of the privy council, which is nearly 90 years now. I find the AC humorous as yet another idiot who doesn't understand constitutional monarchies.

Build up in Brazil (1)

ColeonyxOnline (966334) | more than 3 years ago | (#36362488)

Foxconn is investing $12bn in Brazil [bbc.co.uk] . Citing the rising labor costs in China for this expansion.

Re:Build up in Brazil (1)

Fastball (91927) | more than 3 years ago | (#36363308)

And Brazilian labor is already pushing back [yahoo.com] . Interesting to see how this plays out over time and which culture ultimately wins out. If only the Chinese had a Great Artist they could dispatch to culture bomb Rio De Janiero.

Re:Build up in Brazil (0)

Anonymous Coward | more than 3 years ago | (#36364414)

Brazil has heavy tax in imported stuff, 35% on cars, almost 90% on electronics, so now the foxconn want to manufacture ipad in Brazil, so apple can reduce the price or increased the profits, the government don't care ( maybe a little bit), only care about the local jobs. And the Brazil government has a program to reduce even more the normal tax, it's passed a law to incentive the local manufacture of tablets and it's components. http://www.electronista.com/articles/11/05/24/tax.base.sacrificed.to.lure.foxconn.ipad.assembly/ [electronista.com]

Re:Build up in Brazil (1)

gl4ss (559668) | more than 3 years ago | (#36363986)

ahaha, so the the fix is to dump 12 billion into repeating the same? so they're cheaper labor in brazil, but how does that equate to foxconn getting more money? it's not like they can decide where they assemble the stuff and how and where the parts happen to be.

Hmm... (1)

Weaselgrease (2050100) | more than 3 years ago | (#36362904)

I wonder if it'll ever happen where companies abduct the starving, diseased children in Africa or India (again), drop them in a hidden or secured and un-visitable facility (E.g. no press), and farm their own population of slaves to 'solve the problem of world hunger' and still make a disgusting amount of profit off of the end-buyer.

Re:Hmm... (0)

Anonymous Coward | more than 3 years ago | (#36363636)

Thanks for the idea. I'm going to get on this tomorrow.

Don't worry. I won't deny you any of the credit.

If they could get away with it... (1)

tekrat (242117) | more than 3 years ago | (#36364772)

They would already be doing it (and perhaps they *are* and we just don't know). Since China tends to favor the Chinese, I think they would abduct populations and turn them into "Soylent Green" to feed their own population first.

Secondly, there's ALREADY a cheap supply of labor right next door to them, it's called North Korea. The only problem is that NK has zero infrastructure. I think they are waiting for the current regime to die, and then they will waltz in and take over. And it will actually be a good thing for the citizens, as the Chinese might build the infrastructure needed. In which case NK citizens might get things like running water and electricity.

We've seen in WWII that the Germans used slave labor in underground facilities, I'm sure the Chinese are aware of this and could probably pull it off, if it weren't for all that pesky satellite monitoring.

Re:If they could get away with it... (1)

GameboyRMH (1153867) | more than 3 years ago | (#36366428)

They would already be doing it (and perhaps they *are* and we just don't know).

Do some research on the Marianas islands.

Re:If they could get away with it... (1)

DDLKermit007 (911046) | more than 3 years ago | (#36368720)

Chinese do this to themselves already. Theres been a number of reports that have managed to seep out about this kind of thing. Generally happens with items that remain inside Chinese borders however. People get told to get on the trust for work for a few months, and aren't heard from until a police raid happens because the owner doesn't pay off the right officials anymore. Hell, it happens right in plain sight far too often. Hell, I was in a bath house in Shenzen. Cute little minx going to town on my legs & feet with one of the most badass massages I've had in years. She lives in the same building, is forbidden to leave unless she is quitting, her first SIX months of pay is taken by her suprvisor as a "thank you", oh, and I found out twards the end she was 17, and she seemed like on of the older women doing that. I'd had a number of massages, and other non-questionable services when I was there, but I got that one wrapped up to feeling a bit sickened by all of that, especially the last part. That kind of crap is just common-place. Especially giving anywhere from 6 months to a year of sallary to your boss.

hi (1)

formation (2241238) | more than 3 years ago | (#36363028)

Check to see if your Company name is available http://bit.ly/m2IHF4 [bit.ly]

The idea that Foxconn doesn't sell into China... (1)

YesIAmAScript (886271) | more than 3 years ago | (#36363166)

Is way off base.

Foxconn makes products under contract. Many many of the products they make are sold into China.

They do make few products under their own name plates which is maybe why the reporter is confused?

Also I think the reporter may be confused about what the company actually is. Hon Hai Precision is Foxconn.

Doesn't change anything. (2)

Zoson (300530) | more than 3 years ago | (#36363856)

Foxconn will still make money, they'll still treat their workers poorly, and we'll still keep buying their products.

Foxconn has their hands in EVERYTHING. From sockets to full products under contract with other companies. They do it all when it comes to semiconductors.

Suicides? (1)

bill_mcgonigle (4333) | more than 3 years ago | (#36365504)

Didn't we cover here the story that Foxconn's suicide rate was well below population averages in China? Do the other Chinese 'blue-chip' companies have even lower suicide rates?

Real Evil Feng Shui, Dude. (0)

Anonymous Coward | more than 3 years ago | (#36370858)

That's sideways to and edgewise intersection on a downslope- reflected inside by the mirrors in the workers' locker room - at the very least. Maybe the phones on the assembly line are casting reflections due west? Someone really let this one go by, there. No doubt about it! :)

Check for New Comments
Slashdot Login

Need an Account?

Forgot your password?

Submission Text Formatting Tips

We support a small subset of HTML, namely these tags:

  • b
  • i
  • p
  • br
  • a
  • ol
  • ul
  • li
  • dl
  • dt
  • dd
  • em
  • strong
  • tt
  • blockquote
  • div
  • quote
  • ecode

"ecode" can be used for code snippets, for example:

<ecode>    while(1) { do_something(); } </ecode>