iPhone manufacturer Foxconn is betting heavily on electric cars and reorganizing some of its supply chains as it navigates a new era of icy Washington-Beijing relations.
Chairman and CEO Young Liu discussed the potential future of the Taiwanese company with the media in an exclusive interview.
Electric vehicles (EVs), according to him, will be the company’s growth engine in the ensuing decades, even as Foxconn moves some supply chains out of China.
Foxconn needs to be prepared for the worst as US-China tensions rise, according to Mr. Liu.
“We hope peace and stability will be something the leaders of these two countries will keep in mind,” 67-year-old Mr. Liu said.
“But as a business, as a CEO, I have to think about what if the worst case happens?”
It’s possible that Beijing would try to encircle Taiwan, which it says is a part of China, or worse, will try to invade the autonomous island.
Business continuity planning, according to Mr. Liu, is already in progress. He also noted that some production lines, particularly those connected to “national security products,” have already been relocated from China to Mexico and Vietnam.
He was likely referring to servers Foxconn produces for data centers, which can house sensitive information.
In 1974, Foxconn, or Hon Hai Technology Group as it is formally known, began manufacturing TV knobs. With an annual revenue of $200 billion (£158 trillion), it is now among the most powerful technology companies in the world.
More than half of Apple’s products, including the iPhone and iMac, are made by this company, which also works with Microsoft, Sony, Dell, and Amazon.
It has prospered for decades by a strategy honed by multinational corporations, which involves designing products in the US, manufacturing them in China, and then marketing them globally. That is how it developed into the huge consumer electronics company it is today from a small component manufacturing company.
However, as global supply chains adapt to the deteriorating relations between Washington and Beijing, Foxconn finds itself in a precarious position – sandwiched between the world’s two largest economies, which have previously driven its growth.
From trade to the conflict in Ukraine, the US and China disagree on a number of issues. But Taiwan, where Foxconn’s headquarters are located, is one of the biggest potential flashpoints.
Source-BBC
