According to a report from DigiTimes, the Taiwanese manufacturing giant, Foxconn, which is behind Apple’s iPhone and numerous other major electronic devices, have decided to automate away an extensive number of its human employees.
The general manager of Foxconn’s automation committee, Dai Jia-peng, announced that the company has a plan consisting of three phases, which will allow them to automate their Chinese factories. This will be achieved by using software and Foxbots; the in-house robotics units.
According to Jia-peng, the phase one will involve setting up individual automated stations to replace the work that is dangerous or involves repetitious labor, which the workers are unwilling to do. The phase two will automate production lines, which will result in improved efficiency and also reduce the number of excess robots used. The phase three will involve the automation of entire factories; only minimal workers will be assigned to oversee productions, logistics, testing, and inspection process.
The Foxconn has been slowly and gradually marching towards manufacturing automation for numerous years. Last year, The Company set a benchmark of 30% automation at its Chinese factories by 2020. According to Jia-peng, Foxconn has a capability to produce around 10,000 Foxbots a year, which can take place of the human labor. In March, Foxconn stated that it automated away 60,000 jobs at one of its factories.
The initial investment of automation can be very expensive, but in the long terms, robots prove to be much more cost effective if compared to human labor. Though the reprogramming of a robot to perform the different task than it originally functions, or perform multiple tasks can be very difficult, costly, and time-consuming. Thus the human workers have been cheaper than robots in China’s labor market. Therefore, the Foxconn understand that it will have to transition to automation in order to stay competitive.
The Chinese government has encouraged and provided an incentive on human employment in the country, which brings some complication. In order to allow Foxconn to expand, the local government has dispensed billions of dollars in energy contracts, bonuses, and public infrastructure. Foxconn provided 1.2m people with employment during the last year, which places it among the largest employers in the world. More than 80% of those workers reside in a city like campuses in China.
The New York Times published an in-depth report providing details of the incentives of government for Foxconn’s factory in Zhengzhou, locally known as iPhone City, as it produces over 500,000 iPhones a day. Jia-peng stated that the most capable and largest plant (Zhengzhou) has some productions lines already at the second phase of the automation and on the course to become fully automated in foreseeable future.
It seems that in the upcoming years, one of the largest employers in China will be forced to seize with its ambition of automation and the perks it receives to transform the rural parts of China into industrial powerhouses.
The automation, however, will have a positive impact, especially on a company like Foxconn. It has face distress due to appalling work conditions and even a high rate of suicide of employees; to such an extent that Foxconn had to take measure, like installing suicide netting at factories, to protect itself against the legal litigation and claims against the company. The automation can help Foxconn to relieve itself from this issue without actually improving the work condition or increasing the salary and wages. However, it will make thousands of people redundant.