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Apple has returned a batch of millions of botched iPhones to its main manufacturing partner, Foxconn, a source at the latter company tells China Business. It's believed that anywhere between 5 and 8 million units were returned for various unspecified defects. As the cost to manufacture is estimated to be $200 per phone, Foxconn could be taking a loss of as much as $1.6 billion.
Microsoft and Foxconn parent company Hon Hai have signed a worldwide patent licensing agreement that places the manufacturer underneath Microsoft's patent portfolio umbrella for devices running the Android and Chrome OS. The agreement covers patent usage in smartphones, tablets, and televisions. While specifics of the agreement are not available, Microsoft will reportedly receive royalties from Hon Hai under the agreement.
Asian manufacturer Foxconn has resumed hiring at a plant in Zhengzhou, China in preparation for a new iPhone, a Bloomberg source says. The factory froze hiring in February, but has reportedly been hiring again for the past month to meet extra capacity demanded by Apple. The added workers are expected to build not only a new iPhone but also existing models.
Taiwan-based manufacturer Hon Hai -- better known under its lead brand Foxconn -- posted a 19 percent fall in sales year-over-year during the first quarter, Reuters reports. Revenue reached T$808.97 billion, a decline from T$1 trillion in Q1 2012, as well as the T$988.34 billion the company posted in Q4. The drop is being blamed on lower demand for the iPhone.
There are conflicting accounts over attempted suicides at Foxconn's main manufacturing facility in Shenzhen, China. On Friday, initial reports indicated that two people had jumped off a building; several stories said that in all, three workers climbed to the top of building G14. One source suggests that the people were worried about their jobs. The company has seen lower orders in 2013, prompting it to find ways of shedding workers.
Hon Hai Precision Industry, closely linked to parent brand Foxconn Technology Group, has posted a record NT$37 billion ($1.2 billion US) in net income for its fourth quarter, Bloomberg reports. The figure has also surpassed a NT$35.9 billion estimate averaged using predictions from 14 different analysts. Bloomberg credits the profits to improved and greater production of the iPhone and iPad, including the introduction of new iPads and the resolution of scratched iPhone 5 casing problems, which prior to Q4 forced Hon Hai to temporarily halt work on the phone to impose quality control demanded by Apple.
Apple suppliers performed poorly during February, says Topeka Capital analyst Brian White. The claim is based on an "Apple Monitor," a collection of suppliers the analyst tracks as a way of gauging Apple's performance. Collectively the companies were down 31 percent in February, versus a normal 8 percent drop for the month. The results are bad even when considering the effect of the Chinese New Year, White says -- "the worst February we have on record."
In an update to its Supplier Responsibility pages, Apple on Wednesday now shows that the companies in its supply chain are 99 percent compliant with Apple's guidelines that individual workers -- of which Apple now has more than one million in China and Taiwan -- are limited to no more than 60 hours of work per week. While seemingly a high figure by western standards, factory workers often seek overtime in an attempt to escape the cycle of rural poverty or to support elders in the family. The company reports that the average number of weekly hours is now below 50.
Asian manufacturer Foxconn will soon allow workers to elect union representatives for the first time, says UK newspaper The Telegraph. Under the arrangement, a chairman and 20 members of the Federation of Labour Unions Committee will be elected every five years. The Financial Times remarks that the current representatives weren't nominated in an open and transparent manner; over half of the committee members are in fact from management, making it easier for Foxconn executives to fight any changes they don't like.
Some Apple suppliers will keep manufacturing through the Chinese New Year to meet the company's demands, Taiwan's United Daily News reports. Hon Hai, better known as Foxconn, is said to be keeping a portion of production lines open to assemble the iPhone 5 and iPad mini. A circuit board supplier, Flexium Interconnect, will reportedly keep its Kunshan plant going through the Chinese New Year, using students it has trained for the work.
A new report by the New York Times suggests that working conditions at Foxconn factories have improved since a January piece in the paper helped trigger changes at the manufacturer. After media and public backlash, Apple and the Fair Labor Association began auditing Foxconn, finding problems such as excessive working hours and poor safety standards. Executives from Apple and Foxconn met in March, which led to reductions in worker hours and better wages.
A pair of unconfirmed reports from the sometimes-accurate Taiwanese trade publication DigiTimes claims that Apple is exploring the idea of moving Mac mini production to a Foxconn Electronics facility in the US, and that Apple is evaluating switching its iOS devices to IGZO display panels in a rollout of revisions across 2013. Sharp, the company behind the IGZO technology, has allegedly licensed Innolux Corporation and may possibly add AU Optroics to help produce displays.
Foxconn has bought an almost 9-percent stake in sports camera maker GoPro. The Taiwanese electronics giant agreed to pay $200 million for the shares, which will see Foxconn founder and CEO Terry Gou join the GoPro board. The purchase gives GoPro a valuation of around $2.25 billion, based on Foxcon's ownership of 8.88-percent of the company.
Amazon has reportedly chosen Foxconn to produce the online retailer's rumored self-branded smartphone. Unnamed sources have told Taiwan Economic News the contract manufacturer "actively scrambled" to establish the exclusive supply deal, as some of its other clients—Nokia in particular—struggle to gain traction in the smartphone market.
Even as Apple promises some US-assembled Macs, Foxconn, one of Apple's largest manufacturing partners, is reportedly looking to expand its North American operations in the near future. The Taipei-based manufacturer, which already has operations in California and Texas, cites growing customer demand for American-made devices as the reason behind the shift. Foxconn Chairman Terry Gou said at a forum last month that the company would be interested in bringing US engineers to Asia to train them in manufacturing before sending them back to work in US-based Foxconn facilities.
Hon Hai subsidiary Foxconn CMMSG Industria de Electronicos has bought 350 acres of land near Sao Paulo, Brazil with the intention of building a new factory to assemble smart phones, tablets and other electronics. The deal will create a fifth Foxconn factory in Latin America, and at least the second such facility in Brazil. Foxconn has paid $12.6 million for the land, and will spend more than $490 million building the new facility. The current factory in Brazil is said to be one of the primary assembly plants for the iPad mini. The future facility could be used for expanded production in the Americas.
Foxconn is considering establishing its first manufacturing plants in the US, according to "market watchers" cited by DigiTimes. Locations in cities like Detroit and Los Angeles are currently said to be under evaluation. Foxconn is based in based in Taiwan, and does most of its manufacturing in China, exploiting the cheap labor costs there.
Foxconn is being overwhelmed by demand for the iPhone 5, according to the Asian manufacturer's chairman, Terry Gou. Reuters reports that Gou made the comments to reporters following a business forum. "It's not easy to make the iPhones. We are falling short of meeting the huge demand," he said. Production is currently being handled by Foxconn brand Hon Hai Precision Industry; Gou has declined to say whether Foxconn International Holdings might be handling some of the overflow. Normally FIH handles only non-Apple products.
Taiwanese contract manufacturer Foxconn has acknowledged production difficulties with the iPhone 5, including its new coating that appears to be prone to scratching. An unnamed official at the company told The Wall Street Journal that the iPhone 5 is "the most difficult device that Foxconn has ever assembled."
Foxconn has reportedly admitted that several underage interns were revealed during an internal investigation at its Yantai facility. The company has yet to disclose how many underage workers were found in the plant, though some of the interns are said to be as young as 14 years old.
According to a new report by New York based China Labor Watch, approximately 3,000 workers at the Foxconn Zhengzhou factory have gone on strike off of the onsite quality control line, paralyzing multiple iPhone 5 production lines for the entire day. A combination of tightening quality control requirements coupled with mandatory shifts during the holiday reportedly led to violence and the strike. The strike echoes an event from last month, where 2,000 workers at a different factory staged a walkout and strike, shutting down production for a day.
The Wall Street Journal has corroborated reports suggesting that Apple has started production of its rumored smaller iPad mini. On Monday, Macotakara cited sources from Foxconn’s Brazil factory that also said that production of the iPad mini had begun. According to the Wall Street Journal’s Asian supply chain sources, iPad mini mass production has also commenced in China as well.
Production of the so-called iPad mini is in progress at a Brazilian factory, says a source for Macotakara. The person doesn't name the manufacturer, but it would almost certainly be Foxconn, Apple's main supplier, which opened up a Brazilian plant just this year. Additionally the source claims that the production version of the new iPad is missing a microphone hole on the back, despite earlier mockups suggesting one, and the presence of a rear mic on the iPhone 5.
Contract manufacturers may be preparing to build more than 10 million mini iPad tablets in the fourth quarter, according to Barclays analysts. Most of the new tablets are expected to be produced by veteran iPad maker Foxconn, while Pegatron is said to be tasked with manufacturing approximately three million units.
According to China's own laws, full-time employees may not work more than 60 hours per week -- but enforcement of the law has been notoriously spotty, with many electronics firms cited for violations of the rules -- including Foxconn, the massive manufacturer that has Apple as one of its most prominent clients, though it also makes many Android and other devices for a wide variety of manufacturers. Apple, which has been stepping up enforcement pressure on Foxconn, now reports that 97 percent of its 800,000 workers are in compliance.
Following riots that shut down one of its facilities, Apple supplier Foxconn has claimed that the affected facility will return to production tomorrow. The Chinese company told CNet that the riot, which involved around 2,000 people, had resulted in no deaths and was now under control. Foxconn even disputes the "riot" nomenclature, preferring instead to refer to what happened at its Taiyuan factory as an "incident."
A mass riot of around 2,000 workers at Foxconn’s Taiyun plant has resulted in at least 40 people being hospitalized, reports Reuters. The plant is said to be under lockdown with all operations ceased while Foxconn works with authorities to try and determine the cause of the riot. Athough Foxconn does not officially identify which plants produce products for Apple or other companies, workers have reported that the plant affected is in fact among those that produce the iPhone 5.
Life and work within Foxconn's Tai Yuan factory have been revealed by a Shanghai Evening Post journalist working undercover as an employee. The reporter initially aimed to provide a close look at iPhone 5 production, however his 10-day stint also painted a broader picture of daily life for thousands of workers employed by the Taiwanese electronics manufacturer.
"Thousands" of students are being "forced" to help build iPhone 5s as a part of an internship with Foxconn, says the Shanghai Daily. University students from Huai'an in Jiangsu province are said to have been driven to a Foxconn factory after the plant couldn't get enough regular workers to assemble the smartphone. The claim is based on an anonymous online post from a computing student at the Hauiyin Institute of Technology, which was then corroborated by several students from "at least" five colleges.
A new VIGOOO video claims to show a finished version of the iPhone 5. In the clip, seen below, the hardware is compared against an iPhone 4S. To prove that the 5 isn't just assembled from previously leaked parts, the person in the video boots both devices; while the 4S makes it to the new device setup screen, the 5 stops at an error message. "This device is not registered as part of the iPhone Developer Program. If you are a member of the program, please register your device in the @@url@@," it reads.
An analyst with Berenberg Bank has told investors he believes that Apple must be subsidizing the recent pay hikes that have been given to workers at the Foxconn facilities Apple and other electronics makers use to manufacture iPhones and other consumer devices. Foxconn has been approaching its various partners -- Apple included -- to help subsidize the cost of labor pay increases as well as expansion and improvement of existing facilities, AppleInsider reports.
Hon Hai and Sharp are considering making a $1 billion investment in the latter's LCD plant in Sakai, Japan to help production of displays for Apple devices, Reuters reports. C.C. Lin, an official for Hon Hai -- better known as Foxconn -- made the interest public earlier this week. Lin suggests that Hon Hai is also considering buying Sharp's TV assembly factories in China and Mexico; as for the Japanese investment though, Reuters indicates that an arrangement could be announced as soon as Friday.
The Chinese city of Shenzhen is set to raise its minimum wage by 13.3 percent in 2013, according to DigiTimes. Even though the city already has one of the highest minimum wages in China, the change is thought to be a way for officials to defuse possible civil unrest, since in recent years rising living costs have triggered a number of protests across the country. The pay increase will move Shenzhen's minimum from $236 US to $268.
Shipments of the next-generation iPhone during the current quarter will likely fall under 15 million units, instead of hitting a 20 million unit figure previously forecast, claim supply chain sources contacted by DigiTimes. Part of the problem is said to be low yield rates for in-cell touchscreen panels. Earlier today LG Display announced that it's now mass-producing in-cell components; many of these could be headed in Apple's direction, given ties between the two companies.
Apple's industry-leading membership in the Fair Labor Association (FLA), which promised audits of Chinese companies that acted as suppliers to a number of electronics manufacturers including the iPad maker, has resulted in a progress report that finds evidence of genuine progress. The report found substantial improvements, including some ahead of schedule.
Both a mini iPad and an Apple TV set are in "full production," argues Jefferies analyst Peter Misek. The iPad claim is based on checks with Apple's main supplier, Foxconn, which allegedly indicate that the company is planning to build 25 million new iPads during the September quarter, and another 30 million in the December quarter. The manufacturer also saw an unusual 5 percent monthly bump in revenues during July, which Misek suggests could be linked to building the new tablet. The extra iPad production is over 50 percent higher than Misek's own predictions of 16 million and 18 million units for the two quarters.
US District Court Judge Lucy Koh spend her afternoon dealing with some details of the upcoming Samsung and Apple intellectual property patent trial. In rulings that most favored Apple, Koh ruled that Steve Jobs' statements to his biographer were an "inadmissible distraction," and likewise limited discussion of Apple's Chinese manufacturing efforts to exclude any reports of human rights issues.
Foxconn is gearing up to release an extension to its barebones Nano PC range worldwide later this year. The AT-5250 and AT-5600 are powered by Intel Atom and AMD Brazos processors, respectively, and passively cooled with a fanless design, with a housing that is said to be up to 40 times smaller than a standard PC.
Apple has slotted into 55th place in an annual update of Fortune's Global 500 list. The ranking is based on data from the 2011 fiscal year, which in Apple's case includes $108.249 billion in revenue, with a profit of $25.922 billion. Notably Apple has risen a massive 56 spots, having held 111th place last year. Apple is also said to have achieved $116.371 billion in assets, and $76.615 billion in stockholder equity.
More rumors have come to light about the rumored iPad Mini suggesting that it will take its design cues from the 4th generation iPod touch. Japanese site Macotakara claims the next iPad iteration will be almost as thin as an iPod touch, according to reliable sources in China. The device will be about the same as the Google Nexus 7 in terms of height, but it will be marginally wider.
A fresh rumor has Amazon developing its own entry into the hotly contested smartphone segment, reports Bloomberg. According to 'two people familiar with the matter,' the handset will run the Android OS and go head to head with the Apple’s iPhone and Samsung’s Galaxy S line-up. Amazon is said to be working with Foxconn on the new device, which would join its 7-inch Kindle Fire.
The CEO of Foxconn, Terry Gou has told Focus Taiwan that the next-generation iPhone will put the Samsung ‘Galaxy S III to shame.' He advised consumers thinking of getting the Galaxy S III to wait for the launch of Apple’s next smartphone although he did not go into any details as to what made it worth waiting for. He also took the opportunity to talk up Foxconn’s partnership with Sharp for display development and indicated that he is keen to help Sharp topple Samsung in displays.
Hon Hai -- better known as Foxconn -- is in talks to buy more shares from Sharp, according to company chairman Terry Gou. Reuters reports that Gou revealed the information at the company's annual meeting on Monday; he specifically noted that Hon Hai is taking advantage of a recent drop in Sharp's share price. "When we [first] bought [in March], Sharp's shares were 550 yen, now it is 400 something. It's been dragged by the macro environment. We have already sent delegates there to see if we can buy more shares," said Gou.
A number of workers at Foxconn's plant in Chengdu, China rioted on Monday night, reports say. The incident allegedly began when security guards attempted to stop a thief, and workers with grudges against the guards interfered. From there the situation grew out of control, until as many as a thousand workers were reportedly throwing bottles, bins, chairs, pots, and fireworks from the upper floors of a male dormitory.
Little has changed at Foxconn since it and Apple agreed to make changes in the wake of a Fair Labor Association report, says Student & Scholars Against Corporate Misbehaviour. The activist group recently visited several Foxconn factories and interviewed 170 workers, and claims that rights violations "remain the norm," involving high production targets, inhumane treatment, and evidence of broad salary cuts. "The frontline management continue to impose humiliating disciplinary measures on workers," a SACOM report reads.
Asian manufacturer Foxconn is preparing to spend $210 million on a new Huai'an production line for Apple, according to China Daily. The plant has been announced by local officials, and is expected to consume 40,000 square meters (over 430,556 square feet), and employ 35,800 people. Predicted output is valued at 6 to 7 billion yuan, or somewhere between $949 million and $1.1 billion, with an import/export value of $55.8 million.
Chinese search giant Baidu has released its first smartphone, as it was rumored to be preparing to do last week. The Changhong H5018 is built by Foxconn and is powered by Baidu's own mobile platform, Baidu Cloud.
Foxconn is disavowing suggestions that chairman Terry Gou leaked news of an Apple TV set, writes The Next Web. Last week, Foxconn chairman Terry Gou was believed to have confirmed the existence of an Apple-branded TV. The executive was misquoted, Foxconn now says, and the company can neither confirm nor speculate about any such hardware.
Apple and controversial Chinese manufacturing partner Foxconn are said to be sharing the costs on improving work conditions at its Chinese factories. According to Reuters, Foxconn boss Terry Gou has spoken out on the matter, although he did not place a dollar figure on the investment or exactly where the money will be spent. The company has already raised worker wages by between 16 and 25 percent and has also added thousands more workers to its million-employee workforce to reduce the amount of overtime.
Apple will launch the next iPhone in September, and a 7-inch iPad in August, says DigiTimes. The claims are based on Taiwanese supply chain sources, who add that Pegatron has landed orders for the new iPhone, while Foxconn will handle the 7-inch iPad. The report further suggests that Pegatron will build a new 10-inch iPad for launch in the fourth quarter of this year.
