With an aim to mitigate hiking labor costs in coastal areas of Southern China, Taiwanese Foxconn recently announced that the company, the Chengdu municipal government, and China-based TV maker Sichuan Changhong Electric will enter an agreement, under which they will collaborate to establish a new 8.5G TFT-LCD (Thin Film Transistor-Liquid Crystal Display) plant in Chengdu, Sichuan Province, Western China, Taiwan's Commercial Times reported on June 24. The investment is valued at NT$27.2 billion (US$4 billion; US$1 = NT$6.8), marking the single largest investment in Western China since the construction of the Three Gorges Dam in 1994, according to the same source. Nevertheless, the investment is still pending approval by the Chinese State Council and further details regarding the amount of investment made by individual companies were not yet disclosed.

 

Meanwhile, the European Commission announced on June 28 that after an in-depth review, it had approved the proposal made by Foxconn to acquire Sony's LCD TV plants in Slovakia and Mexico, the Xinhua News reported on June 28. The commission stated that Foxconn acquisition of Sony TV plants raised no competition concerns in the European market. Further details, however, were not yet known.

 

Aside from the establishment of new plants, Foxconn - which provides EMS (Electronic Manufacturing Services) to OEM (Original Equipment manufacturing) makers in the fields of computers, mobile phones and televisions - is bound to relocate two third of its Shenzhen plant to inland China, including Tianjin, Chongqing, Wuhan, and Henan, Taiwan's Commercial Times reported on June 30. In addition, the number of workers in the Shenzhen plant will be reduced from 400,000 to 100,000. The relocation of the plant is slated to kick off on October 1, 2010 and complete within six months, according to the same source. Foxconn already clinched an agreement with the Zhengzhou municipal government, under which Foxconn will set up a new factory in Zhengzhou, the Henan Province, Central China. The number of workers to be recruited by Foxconn's new Henan factory reportedly will be around 300,000. In addition, Foxconn is poised to send 100,000 Henan workers to Shenzhen plants for training and those workers will be given options whether to stay in Shenzhen or return to Henan, according to a statement made by Hebei municipal government on June 25.

 

Meanwhile, the European Commission announced on June 28 that after an in-depth review, it approved the proposal made by Foxconn to acquire Sony's LCD TV plants in Slovakia and Mexico, the Xinhua News reported on June 28. The commission stated that Foxconn acquisition of Sony TV plants raised no competition concerns in the European market. Further details, however, were not yet known.