$1.1 billion expansion may do other phones as well

Although the Foxconn factory in Zhengzhou (the capital of the inland Henan province) was only opened earlier this year, company officials in coordination with government authorities are planning a massive $1.1 billion expansion that would double the manufacturing output, according to a report from China Daily. The expansion would increase daily production of iPhones to 400,000 and would be the world's largest such facility when completed.

The plant, which may also make other brands of smartphones, is expected to achieve $20 billion in sales revenue in 2012 even before the expansion. It is located in Foxconn Science Park, and employs over 130,000 people. Foxconn's recent expansions and plant openings in inland provinces have been part of an effort to reduce labor costs, which are lower in land-locked cities than in China's coastal areas.

The move also aligns with government plans to reduce the temptation for workers to migrate to coastal cities in search of work, and the infrastructure and logistical problems any large population movement would bring to those areas. Henan and Sichuan provinces, home to other Foxconn facilities, have labor costs about two-thirds of that of the coastal provinces.

In all, Foxconn employs about 1.2 million people, most of them working on the Chinese mainland. The company also has factories in Europe, Central and South America, and India. Although Foxconn plants make electronic devices for most major manufacturers, including Sharp, Microsoft, Google and Samsung, the company is a primary supplier for Apple and closely identified with the company. [via China Daily]

By Electronista Staff