Monday, 11 April 2011

iPhone manufacturer reports $218 million full-year net loss

    Foxconn, the mega-manufacturer behind all Apple products (more than 1/3 of Foxconn is dedicated to Apple products), posted a $218.3 million net loss for 2010. While the company had previously predicted lower earnings amid suicide-related wage increases and welfare costs, the reported figure is still worse than analysts' estimation of around $202 million, which also far outweighs the prior year's $38.6 million profit. Foxconn puts the blame on higher consolidated income tax and increased competition, as well as "cost streamlining actions" -- a reference to the ongoing relocation and expansion plans, which are also the outcome of the Chinese suicides -- that took longer than expected and led to increased spending along with higher manufacturing overhead. As for 2011, Foxconn said it'll "take decisive actions to conclude our capacity relocation, optimize our cost structure and return to profitability." Of course, further losses could accelerate plans to increase prices, which could ultimately put everyone in a lose-lose situation if Foxconn can't compete. 
     Foxconn plans to develop a robotized product line and mechanize the workforce to slowly replace the slave-like labor in hope to compete with giants like Nokia, Samsung or HTC.
    Of course Apple hasn't done anything regarding worker well-fare, nor have the manufacturing costs increased. Have you ever wondered how come Apple icon products aren't made in good ol' America?

Via: Foxconn International Holdings (PDF)