As China's Costs Rise, One Company's Solution: A Million Robots

To cope with rising wage costs, Taiwan's Foxconn Technology Group intends to add one million robots to the current 10,000 in use now over the next three years, reports Reuters.

 

Foxconn's move illustrates potential solutions for companies battling rising wage costs, high-profile strikes, and workers' suicides in China.

 

"Automation is a general trend in many sectors in China, such as electronics. Of course some companies will consider moving their manufacturing overseas, but it's easier said than done when the supply chain is here," Dan Bin, a fund manager at Shenzhen-based Eastern Bay Investment Management, which invests in technology and consumer-related shares in China and Hong Kong told Reuters.

 

"Rising salary costs should be the key reason why Foxconn is doing this. This year's wage increase has been quite significant and I don't expect the pace to slow down next year," C.K. Lu, a Taipei-based senior analyst at research firm Gartner told Reuters. "If they don't do this, they will have to move their factories elsewhere."

 

Foxconn assembles Apple's iPhones and iPads in China.

 

 

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