Apple and Foxconn are leaving China? Millions of people facing unemployment? The rapid development of China's supply chain relies heavily on Apple. Nowadays, all these estimates are slowly changing, and Apple's continuous reduction of the proportion of China's supply chain has become a development trend.
At the same time, Apple and Foxconn are also sparing no effort to help the sound industrial supply chains of Vietnam and India. Foxconn has 1.2 million employees in the mainland, and Foxconn's downstream industry chain is the largest group, as well as supporting service industries.
So, is Apple gone a good thing or a bad thing? Foxconn is accelerating its withdrawal from China, is it following Apple's pace? So where do the 1.2 million employees go?
Huge Foxconn industry chain
Foxconn has done OEM for brands has been a long-term thing, and Foxconn has done OEM for Sony, Nokia, Motorola and other well-known brands in the earliest days.
So, what does Foxconn do? Simply put, the brand side puts all the parts of the mobile phone into Foxconn, and the workers in the Foxconn factory install the parts into finished products according to the requirements of the brand side.
Therefore, based on the nature of Foxconn's work, Foxconn itself does not produce any products, but only provides services for assembling parts. Therefore, Foxconn factories need a large number of assembly line workers to carry out assembly operations.
Foxconn was just a small factory without a reputation at the beginning, and what made Foxconn's foundry industry stand out was to do OEM assembly for the Motorola V series mobile phones that year.
Motorola V998 was the best-selling model that swept the world that year, as well as the V3 and Motorola's god V70. At that time, the V70 could be called a real 10,000-yuan machine, and only the real big boss was worthy of it.
The high-end best-selling mobile phones of that year were all assembled by Foxconn. Therefore, with the opportunities of that year, Foxconn can be said to have gained a lot of wealth and popularity.
Apple and Foxconn
So, what is the relationship between Apple and Foxconn? How iron is it between them that can make Foxconn publicly shout: if Apple withdraws from China, the mainland market will change greatly.
First of all, Foxconn's popularity in OEM assembly attracted Apple founder Steve Jobs, who once personally went to Foxconn to discuss cooperation, wanting Foxconn to OEM Apple's mobile phone.
Since catching up with Apple, a big customer, Foxconn has truly entered the fast lane of development.
It is precisely because of the large number of orders from Apple that Foxconn's factories and production lines have begun to increase, opening all over the country. Even the Zhengzhou factory, which now has the largest number of employees, was rushed to start because it needed workers in desperate need of workers.
What will employees face after Foxconn evacuates?
Now, Apple is planning to move production outside of China, especially India and Vietnam. This means that the attractiveness of Chinese foundries to Apple is declining, and India or Vietnam will replace China as Apple's largest production base.
So, is the withdrawal of Apple and Foxconn from China a good thing or a bad thing? There are definitely friends who will say that it is good to go, but in reality it is not that simple. 1/3 of Apple's global production bases are in China.
Once the Apple industry chain retreats, Foxconn alone has seven factories. All 1.2 million employees at all seven factories could face job losses.
What is the concept of 1.2 million employees? At present, only PetroChina has 1.35 million employees.
80% of Foxconn's net profit comes from Apple OEM, and although Gou has not publicly indicated that he will take the next step with Apple's withdrawal, the actual situation is accelerating the withdrawal.
This is only Foxconn, and including the upstream and downstream industrial chains, 6 million people may be indirectly affected. This move naturally has little impact on Apple's users.
However, for workers and businesses that depend on Apple manufacturing for their livelihoods, the retreat of the Apple and Foxconn industry chain means the collapse of the economic pillar.
There is no doubt that the relevant stocks will plummet, and some companies are likely to face bankruptcy.
Look at things differently
With the accelerated departure of Apple and Foxconn, the problems we will face may not be as simple as losing their jobs. The profitability and independent innovation ability of China's supply chain will slowly decrease, and the innovation ability of China's mobile phones will be reduced.
However, from Apple's point of view, 1/3 of the phones sold by Apple in a year rely on Chinese factories. At the same time, the mainland is a major consumer of Apple's mobile phones, and the sudden termination of cooperation will inevitably shake the industrial chain between Apple and the mainland.
But if you look farther ahead, after Apple withdraws, the mainland's production capacity will also be released accordingly, which is indeed a signal and a good opportunity for domestic mobile phones. Of course, it will also be a new challenge.
Finally, I would like to ask what you think about Foxconn's withdrawal from China? Welcome to leave a message in the comment area to discuss.