Foxconn axes 60,000 jobs in one Chinese factory as robots take over

An electronics manufacturing facility in Shenzhen, China. Photo credit: Wikipedia.

One of China’s high-tech manufacturing hubs is accelerating uptake of robots as labor costs rise. As per the South China Morning Post:

Thirty-five Taiwanese companies, including Apple’s supplier Foxconn, spent a total of 4 billion yuan (HK$4.74 billion) on artificial intelligence last year, according to the Kunshan government’s publicity department.

“The Foxconn factory has reduced its employee strength from 110,000 to 50,000, thanks to the introduction of robots. It has tasted success in reduction of labour costs,” said the department’s head Xu Yulian.

“More companies are likely to follow suit.”

As many as 600 major companies in Kunshan have similar plans, according to a government survey.

RMB 4 billion amounts to US$610 million invested in AI to make robots smarter.

UPDATED on May 25, 9 pm: Foxconn responded to questions by Tech in Asia and issued a statement. In part, it states: “We are aware of media reports about automation operations at our facilities in China, including Kunshan, and can confirm that Foxconn has been investing in the automation of many of the manufacturing tasks associated with our operations throughout our facilities in China for many years.”

The company did not confirm the number of jobs given over to robots or how the staffing losses were handled.

It continues: “Our robotics and automation efforts are driven by the needs of each manufacturing process and our goal of continuously enhancing the quality of our products. Across all of our facilities today, we are applying robotics engineering and other innovative manufacturing technologies to replace repetitive tasks previously done by employees, and through training, also enable our employees to focus on higher value-added elements in the manufacturing process, such as research and development, process control and quality control.” The original story, published on May 24, continues below.

The huge shift to robots at Foxconn and other producers could begin a wave of job losses in Kunshan, which is just outside Shanghai in eastern China. Other areas like Shenzhen in the south might be next.

Taiwan-headquartered Foxconn employed 1.4 million people across mainland China in 2015.

Converted from Chinese yuan. Rate: US$1 = RMB 6.55.