updated 11:30 am EDT, Wed June 8, 2011
Chairman: Tablet is 'very difficult to make'
Terry Gou, the chairman of Foxconn parent Hon Hai, says the company is taking steps to improve the efficiency of iPad production that will begin paying off in the second half of 2011. Speaking at a Hon Hai shareholders meeting, the executive explained that the company's profit growth has lagged behind Apple because iPads are "very difficult to make." Hon Hai is constantly discovering ways of building iPads more efficiently, Gou claims.
Hon Hai has recorded two quarters declining profits, attributed mainly to higher wages and the cost of moving factories to inland China. iPad production has also been damaged in recent months. Even though consumer demand remains high, a March 11th earthquake crippled some Japanese suppliers, and a May explosion at a plant in Chengdu, China temporarily halted some output.
"We've helped Apple make a lot of money," Gou remarked at the meeting. "If our customers make money, then we can also make money. I most fear customers that don't make money."