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It is reported that Foxconn, which has 1.2 million employees, is preparing to build a factory in Vietnam, and Foxconn's industrial layout has been adjusted, after it was reported that Apple asked Foxconn to transfer part of its business to Vietnam to diversify production in order to minimize the impact of Sino-US trade tensions. Netizens can't help but wonder: What does Foxconn's withdrawal mean for the domestic manufacturing industry? What about the current employees?
Why did Apple transfer the industrial chain?
Previously, Apple asked Foxconn to transfer part of the iPad and MacBook assembly business from China to Vietnam, and netizens fried the pan.
Even many netizens broke it: Apple's operation to transfer the industrial chain this time was not a whim, but a long time planned.
You know, as an important partner of Apple, Foxconn has contributed a lot of strength to the industrial development of the mainland, contributed a large number of manufacturing talents to Shenzhen's manufacturing industry, and created a lot of economic value.
Foxconn's output value in Shenzhen dropped from a peak of 388.1 billion yuan in 2011 to 229 billion yuan in 2016 and 325.2 billion yuan in 2022.
Despite its ups and downs, Foxconn still provides a large number of jobs for many families.
Among them, the Shenzhen factory alone has nearly 350,000 people, while Foxconn has about 1.2 million employees in more than 100 countries and regions around the world, and has more than 130 factories in Chinese mainland.
The adjustment of Foxconn's industrial layout has aroused discussions among many people at home and abroad.
For , some netizens hit the nail on the head: the suspension of production of Zhengzhou Foxconn is one of the reasons for accelerating the migration of Apple's industrial chain.
According to data, 85% of Apple's iPhone Pro products were once produced by Foxconn's 300,000 employees, and Foxconn's sudden suspension of production caused great difficulties in the delivery of Apple products.
Although Foxconn's shutdown is an occasional situation, it is enough to sound the alarm for Apple, and at the same time, let its leaders see the risks caused by the excessive concentration of Apple's industrial chain, and plan its industrial relocation plan in advance.
In fact, it was previously reported that Apple has begun to shift its supply chain from China to other countries in order to minimize the impact of Sino-US trade tensions, while reducing costs, diversifying risks, and expanding markets.
Then, as its biggest partner, Foxconn must follow its strategy to relocate factories.
According to Reuters, Foxconn will invest 270 million US dollars to build a factory in Vietnam for the production of tablets and laptops, which has been approved by the Vietnamese government, and Foxconn, which has made great contributions to China's economy, will shift its position.
In addition, Goertek has set up factories in Vietnam, and more and more foreign companies have begun to transfer production lines from China to Vietnam, India and other countries, such as Samsung, Toshiba, Intel, LG, Foxconn, as well as Adi, Nike, etc.
These foreign companies are trying to transfer part of their production capacity to Southeast Asia and other countries, and even many domestic enterprises have also relocated, such as Luxshare Precision, Goertek Acoustics, Lens Technology, etc., these companies have invested and built factories in Southeast Asian countries such as Vietnam.
In fact, relocating factories from the mainland to Southeast Asian countries has long been the choice of many enterprises.
The relocation of factories may cause a large number of job losses
The relocation of factories to Southeast Asia may cause many employees in the country to lose their jobs.
In fact, since 2017, Foxconn has begun to increase the number of college graduates recruitment, recruiting 12,000 new college graduates.
Foxconn Technology Group President Terry Gou once spoke in 2017, saying that this recruitment plan responds to the needs of Foxconn's continuous transformation and upgrading and decided on a strategic plan.
In addition, in 2016, Foxconn's boss Terry Gou said that "it will reduce mainland employees by 30% in the next ten years."
Gou also said that the high-quality development of the mainland's real economy is inseparable from the transformation and upgrading of the manufacturing industry, and in the process of Foxconn's transformation to intelligent manufacturing, it is necessary to continuously increase investment in the real economy, especially in the investment in talents.
In other words, highly educated people may be more desirable.
But Foxconn has about 1.2 million employees in China, and it is worth noting that migrant workers or low-educated people account for the majority, and of this group, the three major production bases in Shenzhen, Zhengzhou and Wuhan account for the majority.
They rely on Foxconn for most of their income and lodging, and it would be a big blow if manufacturing plants such as Foxconn left China and chose to abandon these employees.
It is worth noting that the economic development driven by manufacturing will inevitably lead to rising labor costs, and we can see that in the 90s, the increase in costs in South Korea and Japan caused foreign companies to switch to Chinese mainland and move industries to the mainland, because labor costs are cheaper and hydropower resources are abundant.
In addition, the arrival of manufacturing enterprises has also brought a large number of jobs, promoted the development of the mainland economy, and made the economy of all parts of the country flourish.
However, in recent years, the mainland manufacturing industry has been developing, coupled with the impact of inflation, the mainland's labor costs and water and electricity resource costs have also risen, and the high cost has made many manufacturing companies once again look to Southeast Asian countries, and Vietnam, like China in the 90s, has a cheaper labor market, which will naturally become the preferred relocation location location for manufacturing enterprises.
It can only be said that under the general trend, we can only follow the trend, since we can not prevent the withdrawal of manufacturing factories, then we need to improve our own skill level as soon as possible, improve our core competitiveness, can not be self-pitying and resigned to fate, should actively act to find a way out in advance, adapt to the new working environment.
Although there is a risk of losing your job, there are also opportunities lurking in the risks.
We do not need to panic about the withdrawal of these large factories, because this also shows from another angle that the mainland is shifting from labor-intensive industries to technology-intensive industries.
The mainland is slowly embarking on the road of relying on the export of cheap labor products to drive economic development, which is the inevitable result of the mainland's economic transformation.
How to break through China's manufacturing industry?
What Apple has always been unwilling to admit is that although it has been advocating the "de-Chineseization" of production for many years, it has actually been unable to get rid of its dependence on the Chinese market.
Relevant data in recent years show that the number of factories in China in the apple industry is still steadily rising, which is really heartbroken.
For many enterprises, riding Apple's east wind can indeed achieve economic income and obtain corporate profits, but the general environment in recent years is not optimistic.
Our dedicated production may not be exchanged for Apple's high returns, but the performance has been on a downward trend.
It is not difficult to understand that in today's declining supply chain, Apple can only squeeze employees, reduce production costs, and obtain the maximum input-output ratio.
For this phenomenon, we must cure it from the source and reduce our dependence on the apple industry chain.
In other words, when it is looking for mainland substitutes, it can not be cut off from Apple, but at least it cannot fall to the point of being easily manipulated by suffering from gains and losses.
It is undeniable that the existence of the Apple industry chain has indeed benefited the domestic market a lot, but it has also made some industries lose the momentum of independent development, and once the news of the industrial chain transfer is released, the survival of many enterprises that rely on its income will become a headache.
In the future, China's response can learn from Japan and South Korea, which have completed the upgrading of manufacturing, although the import and export substitution strategy was initially implemented, but through continuous struggle and exploration, it has achieved considerable achievements in chips and other fields.
The mainland's economic development continues to enter a new level, which also means that the salary level has increased significantly, as long as you have a higher skill level than ordinary people, you can get much higher salary than before, and grasping to improve your own ability is the fundamental guarantee to seize opportunities.
We live in an era of change, and we must neither ignore the challenges reflected in the difficulties, nor give up the hidden opportunities.
In view of the readjustment of the mainland's industrial chain, we need to accept with a more open and inclusive attitude, judge the situation to seek our own value and advantages, face challenges and achieve our own innovation and breakthroughs in it, maintain the ability to continue learning, and jointly build a better China, I firmly believe that the future development of the mainland's manufacturing industry will be better and better.
So, do you think this factory relocation is an opportunity or a challenge for us? Welcome to leave a message.