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Apple iPhone maker Foxconn to ditch staff in favour of robots

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Taiwanese manufacturer Foxconn is to reduce its workforce by replacing them with as many as one million robots over the next three years, according to reports.

Terry Gou, founder and chairman of the company, which builds products for several big name tech brands including Apple, Nokia and Sony, told the Chinese Xinhua news agency that the move will boost efficiency and cut costs.

Foxconn will increase its 10,000 robots to 300,000 next year and to one million in three years' time.

The news will come as a blow to the one million-plus Foxconn workers on the Chinese mainland, but it's unlikely that any cost savings will ultimately be passed on to customers.

Rising labour costs are ostensibly the main reason for the shift to robotic assembly of products such as the iPhone in future, but margins will still be extremely tight.

In an irony that staff will no doubt be aware of, one of the reasons for rising labour costs at Foxconn is the wage increases offered to some staff in the wake of a spate of suicides over the past year.

Foxconn maintains that the reason for the increase in automation is to move its employees "higher up the value chain", although whether the firm can really do this while keeping a grip on costs remains to be seen.

One thing's for certain, though: robots generally don't run the risk of incurring bad publicity by jumping off buildings.

01 Aug 2011

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