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Apple Could Be Behind Foxconn's Manufacturing Slowdown, But For A Very Good Reason

Apple Could Be Behind Foxconn's Manufacturing Slowdown, But For A Very Good Reason

February 21, 2013
Earlier this week, reports surfaced that Foxconn had instituted a hiring freeze. Because the Taiwanese company is Apple’s largest manufacturer, this would have typically been the type of news covered here at AppAdvice. However, when word came down that the slowdown had nothing to do with Apple slashing iPhone 5 orders, we refrained from discussing it here until now. Fortune has highlighted some of the reasons put forward for the slowdown besides weakening iPhone 5 demand. These include:
  • A slowdown in 9.7-inch iPad sales (Fubon Securities analyst Arthur Liao)
  • A decline in Hewlett-Packard (HPQ) PC sales (UBS's Steve Milunovich)
  • A shift to robotic production by Foxconn (CBN Daily)
  • A shift by Apple to other manufacturers (Business Insider's Nicholas Carlson)
  • Fewer workers going AWOL after the Chinese New Year break (RBC's Amit Daryanani)
That last one is what got Fortune’s attention. They now feel that Apple could, in fact, be the reason behind the slowdown. However, it still has nothing to do with weakening sales. Instead, they suggest:
Could that have anything to do with the fact that Foxconn, pressured by Apple and local workers rights groups, has more than doubled wages and cut overtime hours?
If the question Fortune put forward is proven to be correct, it suggests that Apple is weighing human rights much more heavily than they did in the past. As a result, companies like Foxconn will need to continue improving working conditions, especially in China, or see important jobs head elsewhere. Personally, I hope this is true. I'd like to think that the folks who make the products millions love are being treated fairly. And if they are not, Apple is content with moving business elsewhere. What say you? See also: Things Seem To Be Looking Up For Workers At Apple Manufacturing Partner Foxconn, and Mac Manufacturing Coming To US Next Year, iOS Devices Could Follow.

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