The world’s biggest producer of iPhones is going to outer space.
Two prototype low Earth orbit (LEO) satellites made by Hon Hai Precision Industry Co (鴻海精密), better known as Foxconn Technology Group (富士康科技集團), took off aboard a Space Exploration Technologies Corp (SpaceX) rocket from Vandenberg Space Force Base in southern California on Saturday.
The launch of the LEO satellites marks a key moment for the Taiwanese electronics manufacturer as it diversifies into new sectors — a shift that is taking on greater urgency as some of its established businesses such as smartphones and laptops struggle. Hon Hai is aiming to demonstrate that it has satellite technology to tap growing demand for communications from space.
Photo: EPA-EFE
While Elon Musk’s SpaceX has made and launched more than 5,000 LEO satellites for its Starlink constellation, Hon Hai is betting it would be able to make satellites primarily for corporate and government clients.
The satellites, codeveloped with Taiwan’s National Central University, are the size of a backpack, weigh about 9kg each and carry cameras, communication devices and other equipment. They are designed to orbit Earth every 96 minutes at an altitude of 520km.
The company has in recent years looked for ways to diversify — focusing on electric vehicles (EVs), digital health and robotics, as well as technologies for artificial intelligence, semiconductors and communications satellites.
Revenue is expected to drop about 6 percent this year to NT$6.2 trillion (US$191.6 billion), Bloomberg News estimates show.
While Apple Inc needs millions of iPhones sold per quarter and frequently updates models, customers could go a long time between orders for LEO satellites, so the business is much less predictable, said Tim Farrar, president of Telecom, Media and Finance Associates Inc, a consulting firm in Menlo Park, California. Hon Hai makes about two out of every three iPhones in the world.
For an outsourcing manufacturer like Foxconn, “Unless you can find another one that comes along at the right moment, your life can be very difficult,” he said.
Government orders could provide the company with some security as it builds out its satellite business, Farrar said.
“Foxconn is thinking, if the Taiwanese government gives us a baseline of orders every year, that will be OK,” he said.
Taiwan is working on a plan to launch its first LEO communications satellite, part of a strategy to develop space-based alternatives to the undersea cables that provide most of the nation’s Internet connections.
Another line of support would be the company’s EV business since they require real-time communication technology, MasterLink Securities Corp (元富證券) analyst Jason Wang (王琮生) said.
“You need to have a solution in place for your car to use,” Wang said. “If they want to export this business, they at least need to have an infrastructure in place to demo the technology in Taiwan.”
The company’s background in electronics and know-how gained from making smartphones, game consoles and other devices should help with that.
“Taiwan is very good at making all different kinds of commercial products in electronics,” Academia Sinica’s Institute of Astronomy & Astrophysics research fellow Wang Shiang-yu (王祥宇) said. “These companies can easily switch” to space.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
RSS