HP orders reduce Foxconn workers strike for overtime

Recently, there has been news that a labor dispute broke out at Foxconn's Chongqing plant. A large number of workers in the industrial park before the gate, playing we do not make robots, we have to eat to feed the red slogan of the family. The workers began a strike in Wednesday, mainly because Foxconn reduced overtime for its workers after the number of HP orders declined. In this connection, Foxconn related officials confirmed to the securities daily, Foxconn Chongqing factory did occur about 1000 workers involved in the labor action, but after communication with the staff four hours, reached a settlement, all staff peacefully dissolved. October 9, another 20 employees also carried out similar labor operations, the company is in consultation with the Union and staff to resolve the matter, the factory production was not affected. HP Order Reduction It is understood that Foxconn employees of the basic salary of 2000 yuan, the rest are based on overtime, the monthly salary of about 3000 yuan-4000 yuan. Through continuous IE (industrial engineering) optimization, Foxconn has made its employees a robot for precision operations, reducing overtime by increasing efficiency and achieving cost savings. For some employees, reducing overtime is tantamount to reducing wages. Apple's iphone 6 and iphone 6 Plus were officially on sale in mainland China on October 17, and Foxconn is the main assembly plant, so Foxconn's Chongqing workers ' strike has drawn attention to whether the strike will affect the delivery date of Apple's iphone 6 and iphone 6 Plus. It is understood that Foxconn Chongqing factory mainly to produce computers, servers and other products, not Apple has previously announced the supplier plant, so does not affect the iphone 6 and the iphone 6 Plus the rush delivery. It is reported that Foxconn has assembled iphones, ipads and laptops for Apple, while also assembling computers and servers for HP and Cisco. The Chongqing factory is not on the list of Apple's authorised suppliers. This is the second time this factory has had a strike related to HP this year. HP declined to respond immediately. A labor dispute also took place in the Chongqing plant in June, involving about 800 workers. Because of the gradual reduction of HP notebook orders by Foxconn, the factory has made a decision to adjust the production line, but it has not provided a proper solution to the problem of employee's diversion and cancellation, many employees want to talk with the manufacturer. The road of foundry is not long the succession of labour disputes in Chongqing's Foxconn has highlighted the growing hardships of the Foxconn Foundry. Companies not only face the plight of the meager profits of the foundry, but also face the risk of orders being robbed of food and frequent labor conflicts. China's factories only have a 2% profit on the apple industry chain. The standard version of the iphone 6 Plus components and labor costs are $216, and the 128GB version is up to $263, the securities daily reported earlier. Among them, each mobile phone's line labor cost is 4 dollars to 4.5 dollars. That is, each handset Foxconn earns only 4 dollars to 4.5 dollars. With the gradual disappearance of Chinese people's dividends and the increase in production costs, the foundry is clearly not a long-term business.In fact, Apple's co-operation with Foxconn has been loosened, and it is one of Apple's public strategies to move some of its Foxconn orders to another Apple's Pegatron. and Foxconn to undertake the HP notebook orders are also gradually reduced, and directly led to the Chongqing Foxconn Labor conflict. In fact, Foxconn, the world's largest foundry, has begun to transform in 2014, with the creation of robot-oriented production workshops in Guizhou, new customers including Tesla, and HP-built cloud server company, and the transformation of the King of Foundry Industry has received worldwide attention. Since 21st century, the foundry industry has developed rapidly in China. Multinational companies outsource labor-intensive manufacturing processes to foundry plants in China, including electronic products, automotive parts, apparel and textiles, household products, photovoltaic, integrated circuits, and so on, and China has become a world factory. Foundry is divided into original equipment manufacturers (OEMs) and original design Manufacturers (ODM), the former is responsible for production and not design, the latter is both production and design. China is a common form of OEM, customers have design patents, raw materials and production processes complete control, and responsible for the final sales, manufacturing process links low value-added, the profit distribution is very meager, mainly rely on cheap labor and land costs to profit. Before the financial crisis of 2008, the foundry industry was in full swing, but many challenges have been faced by the foundry industry since then. Foxconn's consumer electronics industry has a lower industry threshold, and Apple's approach to Foxconn, which looks for other generations of factories, reflects this situation from the side. In addition, labour and land costs are rising, and low-cost strategies are unsustainable. Foxconn's performance in recent years has shown the current weakness of the foundry industry. Under this background, it is better to say that Foxconn has to change its own initiative. At present, however, Foxconn's transformation attempt has had little effect, and it has not been able to produce positive impetus to its revenue, or even been judged as a basic failure. Foxconn as a listed company also has committed to the performance of shareholders pressure, but also to go back to the old Apple factory. But the determination of Foxconn's transformation appears to have not wavered, and at the company's annual meeting, Mr. Gou also told shareholders that the transition is key to Foxconn's sustained growth over the next decade.