Hon Hai Precision Industry Co (鴻海精密), the world’s biggest electronics contract manufacturer, said yesterday its short-term economic outlook was not as bad as had been anticipated following a recent flood of rush orders from brand-name vendors.
The company’s outlook for the next one or two months “is still looking good, but it does not in anyway mean a full economic recovery,” Hon Hai chairman Terry Gou (郭台銘) said at a media briefing yesterday.
Speaking at a signing ceremony with IBM Corp for cooperation on a green technology project in Tucheng (土城), Taipei County, yesterday, Gou confirmed that Hon Hai’s Chinese factories are increasing their workforce by 5 percent to handle the last-minute orders.
PHOTO: CNA
On Dec. 19, Gou said the economic downturn was three times worse than expected. He said at the time that Hon Hai would reduce its worldwide workforce to be able to deal with the global slump.
Hon Hai currently has a workforce of about 600,000 in China.
Without discussing his long-term outlook, Gou said a period of market correction was still needed.
Shares of Hon Hai rose NT$3.80, or 5.58 percent, to NT$71.90 yesterday in response to Gou’s remarks.
Hon Hai’s subsidiary Foxconn International Holdings Ltd (富士康) yesterday signed an agreement with IBM, Enterprise Information Management Inc and C-Lock Technology Inc as the Taiwanese firm ventures into green technology.
The team of companies will jointly deliver and deploy GreenCert, billed as the world’s first greenhouse gas emission measurement enterprise system. This is the first time GreenCert technology, which provides computational algorithms for measuring and verifying carbon emissions reduction credits that can be bought or sold on global carbon markets, will be available in the Asia-Pacific region.
“GreenCert can help enterprises collect pollutant emission data and allows them to conduct carbon trading and follow environmental protection rules in their countries,” said Mark Easton, vice president of IBM’s software sales division. “Through partnership with an environmentally conscious company, it greatly enhances GreenCert’s ability to help enterprises in the Asia-Pacific reduce greenhouse gases.”
In the initial stages, Foxconn will base its green engineering operations in the Kaohsiung Software Technology Park (高雄軟體科技園區) to support the government’s agenda on diversifying industries across the nation, Gou said.
He estimated the initial investment at between US$1 million and several million dollars.
Total capital expenditure is likely to reach US$300 million to US$500 million in three to five years’ time, he said.
Gou said that he expected Foxconn’s green technology endeavor in Kaohsiung to create 100 to 200 software engineering jobs.
As local contract manufacturers face tighter margins amid slackening consumer demand and slowing customer orders, Gou said he was not abandoning his roots in contract manufacturing, but simply creating a more innovative and environmentally friendly manufacturing strategy as part of his global enterprise strategy.
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