Mon, Jan 27, 2014 - Page 13 News List

Hon Hai’s Gou sets out 10-year plans

FULL STEAM AHEAD:Hon Hai chairman Terry Gou said he will lead the company’s transformation and create new sources of revenue through technology innovation

Staff writer, with CNA

A troupe from National Taiwan College of Performing Arts performs at Hon Hai Precision Industry Co’s year-end company dinner at the National Taiwan University Sports Center in Taipei yesterday.

Photo: CNA

Hon Hai Precision Industry Co (鴻海) chairman Terry Gou (郭台銘) yesterday said the company aims to more than double its annual revenue to NT$10 trillion (US$331 billion) over the next decade and plans to debut the new smartphones made for BlackBerry Ltd next month in Spain.

Gou said at the opening of the company’s charity festival in Taipei that e-commerce, 4G mobile services, cloud computing and other high-tech innovations will drive the firm’s growth in the next 10 years.

The company, known as Foxconn Technology Group (富士康科技集團) in China, reported revenue of NT$3.95 trillion for the whole of last year, a 1.25 percent increase over the NT$3.91 trillion earned in 2012.

“We have seen the company’s revenue increase to NT$4 trillion from NT$1 trillion in the past 10 years,” Gou said.

“I will lead the company to complete its transformation in the next 10 years and expect annual revenue to grow to NT$10 trillion in a decade,” he added.

Hon Hai is best known for assembling iPhones and iPads for Apple Inc, but has gradually moved to diversify beyond low-margin manufacturing in recent years.

At the charity festival, which also marks the company’s 40th anniversary, Gou said Hon Hai also plans to relocate capital-intensive and high-tech manufacturing to the US, as the company aims to focus on automation, software and technology innovation to create new sources of revenue.

In addition, the company will complement the Canadian handset maker BlackBerry and plans to introduce new phones at the Feb. 24 to Feb. 27 Mobile World Congress (MWC) tech fair in Spain, according to Gou.

“We are working with them to design a new device and we will showcase multiple devices at the trade show in Barcelona in February,” he said, referring to the MWC show, without specifying the actual numbers and types of Blackberry devices.

Hon Hai, the world’s largest contract electronics maker, announced late last month that its Hong Kong-listed subsidiary, FIH Mobile Ltd (富智康), had struck a five-year deal with BlackBerry to develop and manufacture new smartphone models.

In addition to focusing on tapping the rapidly growing smartphone market in Indonesia, the two firms are to make new devices for other emerging markets, including Mexico.

Calling such strategic alliances “a breakthrough in the global technology industry,” Hon Hai said the two companies will further cooperate in the future, including in mutual investments and global marketing.

BlackBerry is facing plunging sales and mounting losses as its global smartphone market share shrinks. Its sales during the September-to-November period fell 56 percent to US$1.19 billion, below the estimate of US$1.59 billion predicted in a Bloomberg survey of analysts.

Gou also said that Hon Hai has been in talks on creating manufacturing partnerships with German luxury-car makers BMW AG and Audi AG.

“One reason is that we will have very big development plans with German automakers, including Audi and BMW,” Gou told a press briefing at the festival without providing details of the plans.

Another key investment destination for Hon Hai is Indonesia, where the conglomerate plans to set up device-manufacturing bases for BlackBerry, as well as building a machine-to-machine network with the Canadian handset maker, Gou said.

However, the US will remain Hon Hai’s largest overseas market in the next three years, he added.

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