Foxconn Building Factories In Indonesia 75
jfruh writes "Chinese electronics manufacturing giant Foxconn is building factories in Indonesia, and upon hearing the news you might be tempted to think the company is simply moving into labor markets where it can find cheaper employees. But in fact, the Indonesian factories will specifically produce smartphones and computers for Indonesians; the country has almost as many people as the United States, but smartphone penetration there remains low."
Isn't that Ironic? (Score:2, Offtopic)
And, if contrary to popular belief, familiarity breeds a lack of contempt....
Insidious.
beta feedback (Score:1)
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I am, I am.
And I'll even inform you when I found a replacement if you want me to. Adapting to change doesn't necessarily mean accepting it. It can as well mean simply replacing it with something better.
Chinese? (Score:2)
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You do know that the official name of Taiwan is 'The Republic of China' and that it's mostly comprised of ethnic Chinese, right? Apparently not...
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By your logic then it is incorrect to call the People's Republic of China "China."
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Yes it is. Even Tricky Dick the Commie Hunter accepted 40+ years ago that the nationalists had lost the revolution. Saying that Taiwan is China is as absurd as when the CCP says that Taiwan is a renegade province. In other news, the British government has accepted that the renegade American colonies aren't coming back.
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Oops, need more coffee. Thought GP said "correct" instead of "incorrect".
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You do know that the official name of Taiwan is 'The Republic of China' and that it's mostly comprised of ethnic Chinese, right? Apparently not...
And (_)is/(_)isn't considered a province of China, depending on who you ask.
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Foxconn was started in Taiwan by an ethnic Chinese [wikipedia.org]. However most of their factories are presently located in mainland China.
Are you certain? (Score:2)
Can we be sure it's not about the low wages?
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They could have millions of Nokia 1100 for all we know (with that data).
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It's probably because of low wages too. I remember when I was in Malaysia I was with someone who dropped off some wages for Indonesians working in a Malaysia factory. Now I worked out the hourly rate and when I went back to Taiwan I mentioned it to people who know about things and they were surprised it was lower than someone doing the same job in China.
So a lot of Taiwanese companies like Foxconn are adopting a "China+1" strategy for manufacturing, i.e. factories in China plus one other lower wage country
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Sure. Where do you think all the stuff you buy is built?
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Yes good for them. But eventually, as Chinese wages increase, more work WILL be moved to Indonesia - I don't buy the bullshit that they just built the factory for the Indonesian market only. You will see them start to build phones and computes for other markets and the factory will be used as leverage to suppress wages in China. That's how it happened here in the US.
It's great that more and more of the World is advancing and it will lead us the road to an advanced planet. Wonderful.
But it's going to cause a
Re:Good for them (Score:5, Insightful)
Solution for the US? 1950s income tax rates and strengthen the unions: try to bring back the institutions and policies we had during our boom times.
In today's political climate, suggesting such things without mentioning their lineage would get you called a "socialist" (by people who say that's bad even though they have no idea what it means), with a possible implication of being a communist.
By that logic, McCarthy missed the big fish. He talked about communists in the state department, but missed that the White House itself was occupied by a communist - Comrade Eisenhower. Talk about us being a bunch of communist dupes! The fellow who we considered an icon of moderation and middle class values was himself a commie.
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And it was so obvious! I mean, Eisen means iron in German, and Stahl (as in Stalin) means steel. And where did the two countries they represented meet only a few years before?
The truth is out there!
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Maybe McCarthy was a commie too. It's a great tactic to distract attention from the big fish by going after the small fry. Damn those commies are clever.
Re: Good for them (Score:2)
Of course, The booming economy of the '50s was because of higher tax rates and strong private-sector unions... It had nothing to do with the massive increases in production capacity & capabilities as a result of the recently ended war effort, right?
Ignoring unions, please explain how government taking a larger portion of everyone's income 'grows' the economy
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Actually the government taking more income can result in economic growth in the middle term. In Eisenhower's case he used that income to build the Interstate Highway System. Which eventually made trade cheaper and resulted in increased economic wealth for all in the US. This does not mean it is good for taxes to increase. What it does mean is that infrastructure spending is a good idea.
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If we had those - inflation adjusted obviously - income tax rates of the 50's, I wonder how the financial collapse of '08 have panned out.
The same. 50 to 1 leverage doesn't change because of income tax rates. Neither does the Fed's easy credit policy change. That's the two big factors right there.
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Maybe you haven't noticed, but that's the opposite of what the rich people who control our legislatures are paying for.
They pulled the ladder up behind them on purpose; they don't want an egalitarian society.
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Solution for the US? 1950s income tax rates and strengthen the unions: try to bring back the institutions and policies we had during our boom times.
Let's consider the other policy items that weren't around then. There was a lot less regulation, for example, no EPA or OSHA.
Social Security took a much smaller bite (3-5% instead of over 15% currently [taxpolicycenter.org]). Certain huge changes would need to be done to US health care, particularly the constraints on employer-offered health insurance and the recent individual and (as yet not implemented) employer mandates.
While education was less prevalent and subsidized, it was also far less expensive.
So let's critiqu
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Indonesia is already growing rapidly, and labor there is not a lot cheaper (if at all) than China. Any cost savings from moving factories from China to Indonesia are going to be very short term. Probably a better strategy if all they are worried about is cost is to move them out of expensive South Eastern China into the provinces, as the Chinese Government is trying to encourage with all the ghost cities they are building.
slave labor (Score:3)
In China they can treat people like virtual slaves but in Indonesia they can get actual slaves (people who bought a job from a dealer and came over from say Thailand only to have their passports taken by their new bosses and all their salary taken as interest on the loan, cost of rent for their on factory dormatory etc). I think we should seriously consider whether outsourcing is worth it. Companies make small concessions to "cultural differences" in labor practices in overseas markets. Those companies make "small consessions" when they outsource to regional players, etc. Eventually you have children working in illegal mines at gun point in a forest somewhere. I really don't the latest iCrap that bad.
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US and Europe in the 1980s: If you wanna sell here, you should make here.
China, India, Indonesia, Brazil: Fair enough a rule.
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China, India, Indonesia, Brazil: Fair enough a rule.
No, they don't just want to make it locally for local consumption. If they did I'd think it reasonable.
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Exactly. Especially with China: they want to make yours and theirs too. Ie make it hard for foreign companies to sell there without a local partner but they are of course okay selling their crap to you.
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I really don't the latest iCrap that bad.
Would you be willing to pay an extra $4 for a product not made with slave labor? That's the estimate of how much more it costs to make the Moto X because it's done in the US.
Re: slave labor (Score:2)
Really? You could pay everyone involved in the entire production chain (raw materials to sub-assemblies to final assemblers/packers) a non-slave (AKA 'living Wage'?) by increasing the retail price of an iPhone $4? I find it hard to believe - please explain.
And, when talking about price for something like an iPhone (as one example) remember there are many different price points:
Price of an unlocked iPhone to an individual
Price of a locked iPhone sold in bulk to a carrier/retailer
Price phone company (Apple, M
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It's almost believable depending on sales volume and what's considered a non-slave wage and how many get the extra money.
A cursory Google search showed that Samsung sold 40 million Galaxy S4s. The phone was introduced in March 2013, so if you figure 50 million units in a year, that's $200 million dollars in annual salary to disburse. If the number of affected workers is 10,000, that's $20,000 in supplemental pay.
That doesn't seem totally unbelievable, especially considering $20,000 per year in salary is
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Really? You could pay everyone involved in the entire production chain (raw materials to sub-assemblies to final assemblers/packers) a non-slave (AKA 'living Wage'?) by increasing the retail price of an iPhone $4? I find it hard to believe - please explain.
Please explain why you find that hard to believe. Is it because you've unquestionably accepted the "everything is so much cheaper to make in China" line? If cheap labor was always the key to less expensive products, the Industrial Revolution never would have happened. See, for example, GE's experience with their hybrid hot water heaters, where moving the manufacturing back to the US and properly designing it for manufacturability (using information and design suggestions from the assemblers themselves) actu
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In China they can treat people like virtual slaves but in Indonesia they can get actual slaves (people who bought a job from a dealer and came over from say Thailand only to have their passports taken by their new bosses and all their salary taken as interest on the loan, cost of rent for their on factory dormatory etc).
I take it you don't know much about SE Asia.
Thailand is one of the better off nations, comparatively speaking. In fact, Thailand has a big problem with illegal workers hopping over the border from Myanmar (Burma) and Laos (which Thai businesses are more than happy to give the worst jobs to). The "guest workers" in Indonesia are more likely to be Burmese, Laotian, Cambodian or Filipino but the workers will be mostly Indonesian as Indonesia is a big place and some islands/provinces are worse off than other
How Can They Loose? (Score:2)
Re: How Can They Loose? (Score:2)
How can so many Americans, themselves living on government handouts and public assistance 'afford' iPhones that several hundreds of dollars?
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Simple: they bought the phone before they lost their job and their house, and now they keep it just in case some company decides to take pity on them and hire a homeless bum, so they'll get the call to come in for their interview.
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How can so many Americans, themselves living on government handouts and public assistance 'afford' iPhones that several hundreds of dollars?
Just doing a quick google search, it looks like the average single person on welfare can receive ~$300 a month. That's not including food stamps, medicaid, or housing assistance. Not to mention that a LOT of people living off welfare are defrauding the system by hiding assets, income, or additional support they receive from others. Around here, it's not uncommon for a woman to go on welfare/food stamps/medicade/housing support, while her live in boyfriend goes to work at some retail location. All of her
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That's minimum wage in neighboring Malaysia, which employs many Indonesians as factory, construction and domestic workers.
Re: How Can They Loose? (Score:2)
You can't imagine a lower-priced blackberry custom made for the Indonesian market?
Title Bad Need More Better (Score:3)
"Foxconn Building Factories In Indonesia"
Wow! Foxconn has factories dedicated to constructing buildings?!?!
I bet the assembly line is frikkin HUGE!
Now the workers don't even have to go outside to jump to their death! They can just jump off the assembly line!
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In the Philippines, there are factories dedicated building parts of buildings and then shipping them worldwide. [businessweek.com]
Foxconn may not only be getting less expensive labor, but a marketing coup by making 'Indonesia's Smartphone'.
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Where is the difference between a device costing 300 bucks or 400 bucks if you have 0.00 bucks because you have no job?
Taiwan is not China. (Score:2)
Foxconn is Taiwanese, not Chinese. That's an essential distinction because neither the Taiwanese government nor their businessmen have any allegiance to the People's Republic of China. The fact that they've torn down a lot of barriers to travel and business is primarily due to opportunities for profit.
Taiwan still has a strong manufacturing base and like most other countries shifting manufacturing to China because it was cheaper. The fundamental driver, was cheap labor and overall lower cost of doing busine
w-h-y d-o s-l-a-s-h d-o-t f-o-r-c-e-s b-e-t-a? (Score:1)
taxation (Score:2)
i heard that taxation on electronic "luxury" goods is at an insane level in indonesia, resulting in grey imports and smuggling. building a factory in indonesia would be a simple way to get round the problem.
Chinese...riiiiight (Score:1)
Hon Hai Precision Industry Co., Ltd., trading as Foxconn Technology Group, is a Taiwanese multinational electronics contract manufacturing company headquartered in Tucheng, New Taipei, Taiwan. Wikipedia
Stock price: 2317 (TPE) NT$81.70 +0.30 (+0.37%)
Feb 10, 1:30 PM GMT+8 - Disclaimer
Founder: Terry Gou
Founded: 1974
Headqhttp://slashdot.org/story/14/02/10/138219/foxconn-building-factories-in-indonesia#uarters: New Taipei, Taiwan
Foxconn + Mozilla (Score:2)
Criticize the technical merits all you like, but Mozilla's partnership with Foxconn to produce inexpensive phones may turn out to be very strategic (for both parties).