Foxconn plans to use 1 m robots in 3 years

Written by Reuters | Hong Kong | Updated: Aug 2 2011, 06:31am hrs
Taiwans Foxconn Technology Group, known for assembling Apples iPhones and iPads in its China factories, plans to use 1 million robots within the next three years to replace workers performing some simple procedures, its chairman said.

Foxconn, which has been plagued by a spate of workers suicide in its Chinese factories since late last year, plans to use the robots for simple assembly line tasks, Gou was quoted as saying by the China Business News.

A source close to the company confirmed the comments, adding that Gou made the comments in a speech prior to a staff event last Friday.

Foxconn has about 10,000 robots in use now, and will increase the number to 300,000 next year and 1 million in three years, Gou was quoted by the paper as saying.

Analysts said rising labor costs in China were prompting some contract manufacturers in China to switch to more automation.

Rising salary costs should be the key reason why Foxconn is doing this. This years wage increase has been quite significant and I dont expect the pace to slow down next year, said CK Lu, a Taipei-based senior analyst at research firm Gartner.

If they dont do this, they will have to move their factories elsewhere.

Since last year, China has been struck by a series of labor-related issues, such as high-profile strikes and suicide cases at well-known companies as heady economic growth fueled the need for wage increases.

In southern China, auto and parts factories owned by Japans Honda Motor and Toyota Motor Co went on strike. The firm, which has seen a series of worker suicides, has been criticised by labour rights groups for harsh labor practices.

Foxconn employs about 1.2 million workers, 1 million of which are based in mainland China, the China Business News said.

Late last month, a worker fell to his death at a Foxconn manufacturing plant in southern China, local media reported. The workers death was the latest in a series of apparent suicides by young migrant workers at its factory complexes in the past two years.

Other than Apple, Foxconn also counts Dell, Hewlett-Packard, Nokia and Sony Ericsson among its clients.