According to SCMP, Foxconn Technology Group, the world’s largest contract electronics maker, moved forward with plans to diversify its supply chain and spent US$500 million in its Indian subsidiary.
This seems to be triggered by China’s strict controls on the COVID pandemic, which interrupted production at its top iPhone plant in Zhengzhou.
Reuters reported Foxconn Group had acquired 4.08 million shares in Foxconn Hon Hai Technology India Mega Development Private Limited for $500 million. It plans to quadruple the workforce at its iPhone factory in India, up to 70,000 by adding 53,000 more workers over the next two years.
The capital infusion came when production at Foxconn’s Zhengzhou plant was hampered by an exodus of tens of thousands of employees and worker protests. In a regular year, by this time of year, 300,000 people are hired to handle holiday orders at this plant.
According to The Wall Street Journal, in a letter to Chinese policymakers delivered more than a month ago, Terry Gou, the founder of Foxconn, reportedly said that China’s zero-COVID policy harmed his company’s position in international supply chains. He also demanded additional information about how the rules affected the employees of Foxconn. China’s State Council Information Office has not responded to Gou.
Foxconn has also quickly prepared other options for itself.
In August, Foxconn invested $300 mi llion more with a Vietnamese developer to expand a new local plant.Taipei Times reported that Foxconn announced $58.98 million of investment into a subsidiary in the Czech Republic last week. The company currently makes screens, smartphones, and cloud servers and runs design, research, and development centers.