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Businesses The Almighty Buck Apple Hardware

Apple's Top Assembler Foxconn Confirms Plans for US Investment, To Create 50,000 Jobs (bloomberg.com) 324

Foxconn, the biggest assembler of Apple devices, is in preliminary discussions to make an investment that would expand the company's U.S. operations. From a report on Bloomberg: The disclosure came hours after an announcement by U.S. President-elect Donald Trump and SoftBank Group's Masayoshi Son to invest $50 billion in the U.S. and create 50,000 jobs. The money will come from SoftBank's $100 billion technology fund, which was announced in October, a person familiar with the matter said. A document that Son held up after the meeting in Trump Tower also included the words "Foxconn," "$7 billion" and "50,000 new jobs" in addition to SoftBank's numbers. "While the scope of the potential investment has not been determined, we will announce the details of any plans following the completion of direct discussions between our leadership and the relevant U.S. officials," Foxconn said in a statement. "Those plans would be made based on mutually-agreed terms."
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Apple's Top Assembler Foxconn Confirms Plans for US Investment, To Create 50,000 Jobs

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  • by Anonymous Coward

    Only fair.

  • A new golden age (Score:5, Interesting)

    by Anonymous Coward on Wednesday December 07, 2016 @09:05AM (#53439453)
    Finally with an entrepeneur taking the reins we may be staring down a new golden age for America... withtout all the BS and fake numbers spewed by the recent federal government regimes. Unemployment at less than 5%? Puh-leeze. I guess maybe if you count crap work and part time jobs with no benefits. Trump is going to take the world by the balls and basically start squeezing and say "stop fucking us over OR ELSE. Now would you like to talk?"
    • by OzPeter ( 195038 ) on Wednesday December 07, 2016 @09:30AM (#53439583)

      Trump is going to take the world by the balls and basically start squeezing and say "stop fucking us over OR ELSE. Now would you like to talk?"

      The problem is that while Trump may think he has his hands on the world's balls, he doesn't realize that the world also has it's hands on the US's balls. Trade doesn't exist in a vacuum and playing chicken with the economy is not something to look forward to.

      • by meta-monkey ( 321000 ) on Wednesday December 07, 2016 @09:35AM (#53439619) Journal

        For the past 30 years we've been rolling over and playing dead. Maybe try something else for a bit?

        • by OzPeter ( 195038 )

          For the past 30 years we've been rolling over and playing dead. Maybe try something else for a bit?

          I have no problem with trying something different, but extremism is always ill-advised.

          Just imagine the state of affairs 1 year down the track if Trump issues some scorched earth policy that somehow pisses off the middle east* and in response OPEC suddenly ramps up oil production and destroys Trump's attempt to boost the US oil industry and causing a major meltdown in employment in the midwest.

          * Given his Taiwan excursion this week (planned or unplanned - you make the call), pissing off other countries is n

          • Re: (Score:2, Informative)

            Trump's Taiwan excursion was heavily planned after months of lobbying by Bob Dole and other registered foreign agents of Taiwan. Oh, and the Trump Organization sent someone to investigate a potential billion dollar deal to develop land in Taiwan while this was going on. But no conflict of interest there!

            • by AmiMoJo ( 196126 )

              The other reason that China bought up a lot of US debt was to make sure there were no more property bubbles in the Far East funded by American money. They deliberately prevented Trump and people like him developing land over there, and aren't about to let them now.

              It could get ugly if Trump and co. start using the US economy as leverage to get personal real-estate deals off the ground.

          • by meta-monkey ( 321000 ) on Wednesday December 07, 2016 @10:20AM (#53439913) Journal

            Just imagine if bad things happen! Your overactive imagination is not an argument.

            Also, am I allowed to be pissed off at China for taking our jobs, our factories, our IP, constantly fucking with their currency and failing to abide by our trade agreements? What does anyone being "pissed off" have to do with anything? Are you the kind of guy who pays sticker price for a car because you don't want to "piss off" the car dealer? Who gives a shit.

            • Re: (Score:2, Informative)

              by Anonymous Coward

              Uh, the pissing off China by seemingly recognizing Taiwan as an independent state is a thing that actually happened, you know.

              If you voted for DT, you are not allowed to be pissed off. China didn't take your jobs / factories. IP you MAY have an argument for, but not the other two. Chinese Manufacturers and Corporations can produce for much cheaper labour. In a "pro-corporation" stance that many Americans seem to have taken that want less regulation (despite backroom deals with specific companies), this

            • Re: A new golden age (Score:2, Informative)

              by Anonymous Coward

              China is taking our real estate, too.

            • by Ksevio ( 865461 ) on Wednesday December 07, 2016 @11:50AM (#53440633) Homepage
              Because in return you get cheap consumer products and the consequences of Chinese manufacturing are far away. Manufacturing jobs aren't coming back to what they were a few decades ago. Automation means factories need to employ far fewer people. Do you really care if a factory is physically located in the US or in China if there are (relatively) no people employed at it? Let's assume the factory extorted the government to avoid paying taxes.
              • by Anonymous Coward on Wednesday December 07, 2016 @01:10PM (#53441247)

                Why the fuck would I want a $300 smartphone if I can't get a job for more than burger-flipper wages? My grandfather could afford to raise a family, buy a house, go on vacations, and send his kids to college on his blue collar salary alone. A shiny iphone is a piss-poor substitute for that. I would cheerfully pay 10 times for these stupid electronic gizmos if it means I get back the standard of living that once made America the envy of the world.

                • I would cheerfully pay 10 times for these stupid electronic gizmos if it means I get back the standard of living that once made America the envy of the world.

                  Sure, who wouldn't? The problem is, it doesn't mean that at all. If the gizmos are assembled by robots in America and the money goes back to China or even better, gets hidden away in whatever country is the tax haven of the week, then the end result is actually worse than if the doodads had been made in another country because we have to eat all of the pollution. And as it turns out, Foxconn has a bad record even for a Chinese company [dailytech.com].

                  Letting Foxconn build an automated factory in the USA, employing construc

            • by AmiMoJo ( 196126 )

              Are they really "taking" your jobs and factories though? I mean, do you actually want a job that pays $2/hour manually assembling stuff like a robot all day? And if China didn't exist, would you be able to get that job or would it have been automated already?

              It's more like, to sustain a reasonable standard of living in a modern western country you need both cheap goods and a higher wage than the cheap goods can sustain, and should focus your effort on better paid high end manufacturing and services.

              • High end manufacturing? You mean, like the most advanced cell phones and electronics in the world?

                • by Jzanu ( 668651 )
                  More like value-added services like operational research on the function of a mine, or design of the next global power super computer, or anything that isn't really just a commodity item on the downward section of its product lifecycle. Look it up.
                  • And how exactly do you expect our average 100 IQ worker to do that shit? That's all fine for me...I'm an electrical engineer. But what about my less gifted countrymen? What should they do?

                    • by ranton ( 36917 )

                      And how exactly do you expect our average 100 IQ worker to do that shit? That's all fine for me...I'm an electrical engineer. But what about my less gifted countrymen? What should they do?

                      100 IQ workers are the least of our problems. How about the approximately 34% of people who fall between 85-100? That question is essentially what led me to become more progressive in my late 20's. There is no answer for the majority of these people other than public assistance. We cannot wish ourselves back to a world where manufacturing work had enough economic value to support $30/hour jobs with good pensions. At least not tens of millions of these jobs anyway.

                      The answer is ensuring everyone is able to h

            • You shouldn't be pissed off at China for ignoring the IP of the developed nations and using it to catch up. That's what countries at their stage of development do. The US did that early in it's history, especially with fabrics. So it's a bit hypocritical for the US to have used those techniques to advance their economy and then try to deny China the same thing. Either that or admit that it was wrong for doing those things in the past.

          • Re: (Score:3, Insightful)

            by Anonymous Coward

            "OPEC suddenly ramps up oil production " The Saudis already tried this strategy and all it did was make the US shell oil production companies become more efficient and lower the profit breakeven point.

            "scorched earth policy that somehow pisses off the middle east"
            The ME has already been "scorched" for quite some time. It's time the US backed out of the region and let the murder and mayhem currently sweeping the region burn itself out. You would be hard pressed to find any US citizen who would object to this

      • by neo00 ( 1667377 )

        ... he doesn't realize that the world also has it's hands on the US's balls. Trade doesn't exist in a vacuum and playing chicken with the economy is not something to look forward to.

        I wonder to what extent this is true, in context of this story. Given the fact that this money seems to be coming primarily from Saudi Arabia and, potentially, other unknown sources.

        The money would come from a $100 billion investment fund that SoftBank Chief Executive Masayoshi Son is setting up with Saudi Arabia's sovereign-wealth fund and other potential partners, according to the Wall Street Journal.

        Src: http://www.foxbusiness.com/pol... [foxbusiness.com]

        • by OzPeter ( 195038 )

          I agree that it doesn't seem to apply in this particular case*, but the OP was positing a new golden era based on playing hardball - which was what I was replying to.

          * The interesting thing is that from the article you linked:

          It was not immediately clear how much of SoftBank's investment has been disclosed before. Softbank said on Nov. 7, the day before the U.S. election, it planned to make future large-scale investments via the $100 billion tech fund, rather than on its own, to avoid growing already bloated debt.

          So it seem that Trump is taking advantage of something that wasn't his doing.

          I can also see the Dem's having a field day about Saudi money financing Trump's desires.

      • by dcw3 ( 649211 )

        So, with most of the money flowing out of the US, who has the most leverage if that flow is cut back?

    • It's adorable that you actually think any of that is going to happen.

    • Finally with an entrepeneur taking the reins we may be staring down a new golden age for America... withtout all the BS and fake numbers spewed by the recent federal government regimes. Unemployment at less than 5%? Puh-leeze. I guess maybe if you count crap work and part time jobs with no benefits. Trump is going to take the world by the balls and basically start squeezing and say "stop fucking us over OR ELSE. Now would you like to talk?"

      You have no idea what kind of "jobs" this will even end up being. Foxconn is already shipping jobs out of China to Africa and automating more of their plants because Chinese workers cost too much, so don't expect these token jobs to be making more than minimum wage. They could even go the Wal-Mart route and make them part time with the government (tax payers) picking up the rest through welfare.

    • Unemployment at less than 5%? Puh-leeze. I guess maybe if you count crap work and part time jobs with no benefits.

      In other words, most of these 50,000 new assembly plant jobs?

  • by Anonymous Coward on Wednesday December 07, 2016 @09:15AM (#53439503)

    I suppose this doesn't have anything to do with current regulators blocking of Spint's merger with T-Mobile. Softbank president Son owns Sprint, so perhaps he's looking for a little favor when Trump assigns new folks over at the FCC.

  • God, it's going to be an awfully big sales and marketing department.
  • by queazocotal ( 915608 ) on Wednesday December 07, 2016 @09:20AM (#53439527)

    50000 workers, at $25000 is 1.2 billion per year.
    These 'factories' are not going to be using employees at $10/hr to assemble PCBs.
    I note a story earlier this year "One factory has "reduced employee strength from 110,000 to 50,000 thanks to the introduction of robots", a government official told the South China Morning Post. ".

    Most of the putative 50000 jobs are going to be construction work building the factories.
    The factories are then going to be - if not totally lights-out - reducing employees to the bare minimum.
    If you're building a new factory in the USA, and contemplating employing workers at $10/hr for 5 years (three shifts), that's $500K per station or so (probably more costing all costs of employees.

    If you have even 100 employees constantly doing a very similar job, you can easily afford to spend 5 million developing a custom robotic solution, and deploying it for another $5m ($50K/station), and come very considerably out in front.

    ($10/h*24h*365*5 = 438k. Employers taxes and obligations add to this comfortably exceeding the 500k figure for three shifts)

    • by Major Blud ( 789630 ) on Wednesday December 07, 2016 @09:39AM (#53439639) Homepage

      Most of the putative 50000 jobs are going to be construction work building the factories.

      That's still a net positive. That's 50,000 construction jobs that wouldn't exist in the U.S. if FoxConn stays put in China.

      If you have even 100 employees constantly doing a very similar job, you can easily afford to spend 5 million developing a custom robotic solution)

      $5,000,000 to develop a custom solution?!?! You're seriously underestimating the cost involved with that. Just a off-the-shelf robot alone can cost $100,000, without programming or other peripherals.
      https://techcrunch.com/2016/03... [techcrunch.com]

      • 50000 jobs constructing the factory for a couple of years at which time it goes away.
        And foxcon is not paying market prices for robots, for the simple reason that it makes sense to build them themselves - if they're going to end up replacing pretty much every worker. Even if they weren't, if you bought 10000 of them, the price would come down very considerably.

        http://www.bbc.co.uk/news/tech... [bbc.co.uk] was the initial 'robots replace workers' story I was quoting earlier.

        • by Ed Tice ( 3732157 ) on Wednesday December 07, 2016 @10:16AM (#53439879)
          Yes but it's still better to have the construction and the factory here. There will be some jobs and maintenance as the factory runs. What's being pointed out here is what is already known by those who want to know. Automation is taking away more jobs than outsourcing. And that's not going away. The good thing about automation is that it's making US manufacturing competitive again. The downside is that manufacturing is just going to be a much smaller employer going forward.
      • by AmiMoJo ( 196126 )

        It's great for Trump, gives him a nice boost while in office and then stiffs whoever comes afterwards as the contracts end.

        Don't get me wrong, it's good that manufacturing is being built up in the US, but it's not a long term solution to the 21st century.

      • Your net only extends to America. Which is better than most American's net, which only extends to themselves.
      • Most of the putative 50000 jobs are going to be construction work building the factories.

        That's still a net positive. That's 50,000 construction jobs that wouldn't exist in the U.S. if FoxConn stays put in China.

        Temporary construction jobs isn't going to stop the hemorrhaging, and a band-aid fix isn't exactly delivering long-term prosperity, especially when some of those temporary jobs are going to be used building robots to replace human workers.

        Yes, it delivers temporary benefits, but rest assured we will hear the I-created-50,000-new-jobs statistic regurgitated 10 years from now, which at that point will be utter bullshit.

      • Foxconn is already heavily involved with robotics, and is reducing their employee count in China because of it. So honestly, the robotic stations have been developed, they just have to ship them here.
  • It's easy to create 50,000 jobs if you don't have to pay them well or hire locally. When those 50,000 seats are all filled by domestic workers making at least market rate, then it is time to call it a good job.
    • by ZipK ( 1051658 )
      The jobs will be filled by Russian chatbots.
    • Re:Americans? (Score:4, Insightful)

      by bluefoxlucid ( 723572 ) on Wednesday December 07, 2016 @09:45AM (#53439697) Homepage Journal

      Actually, it's not.

      50,000 American jobs created by factory work? Okay. Now, those iPhones have to generate revenue to pay for those jobs. Apple has huge profit margins, so this isn't much fair (the US business average is under 10% profit margin); but let's say Apple isn't altruistic and is trying to keep those huge profit margins, or just pretend Apple is a normal US business with normal profit margins that fit its business growth and risk control needs (because the only violators of this are what, Apple, Google, and Microsoft?).

      To keep the same margins at higher American worker costs, you charge more for the phone.

      If you ship fewer phones, you'll have fewer jobs. That includes fewer exports, too, so less international revenue coming to the U.S.; but let's assume that doesn't happen. Everyone buys iPhones at $1,400 instead of $700.

      Someone concluded 36 million iPhones sold in the US. If we're imagining a doubling in price above (for illustration; order of magnitude is controlled by depth of price difference, and the difference isn't at 0--we'll get to that), that's $25.2 billion. That's equivalent to 1.52 million minimum-wage incomes.

      So for 50,000 jobs shipping 36 million iPhones to US customers (which I doubt actually happens) at $700 additional cost (doubling the price), you lose a maximum of 1.52 million jobs. It's only 50,000 jobs lost if the wages are on average $262/hr for those lost jobs ($524,000/year).

      As I said: the price increase controls magnitude. If you increase it by $100 ($700 becomes $800), you're looking at $3.6 billion. That's 218,000 minimum-wage jobs, or 50,000 $72k jobs ($36/hr average wage). That's your exchange.

      All of that is based on the sales of US phones to US people. That doesn't count international sales. The biggest take-aways here are that job creation or loss in practice depends on how much you pay the workers--pay them less and you create more jobs, as you noticed--and that everyone who isn't a factory worker and who buys the factory worker's product has less money to spend.

      At best, this is a way to enrich factory workers at the expense of all other Americans, reducing the number of available products and services (e.g. we could have expensive iPhones and no Spotify) by drawing both domestic and international money to a subset of peoples's hands, with the international money being spendable back into the US economy. At worst, this is a way to create poor US factory workers, a poor US middle class, and less-competitive United States business, causing a rapid fall in sales as people in Europe roll their eyes at higher-priced iPhones and just go to buy the Chinese-made competitor's product--or maybe Apple will sell Chinese-made phones outside the US and stay competitive, but the US factory workers won't get that international money (14,000 employees at Apple HQ are still getting that cash and propping up Cupertino's economy with $2 billion of wages from across the world).

      Again, as you observe: the net job change will be positive (an increase) if we pay the factory workers little and abuse them with minimal benefits and other cost-cutting measures, making them poor even as the products they produce become more-expensive than the import product. Even then, the US consumer still has less money to spend on everything else, and is thus poorer: he can buy fewer things with the same income.

      • According to your "logic", the wisest thing we could possibly do is export and outsource ALL American jobs. Just imagine how rich we'd all be if none of us worked and nothing was produced here!

  • by fredrated ( 639554 ) on Wednesday December 07, 2016 @09:25AM (#53439547) Journal

    That's a million dollars a job. Seems like a lot.

  • Bullshit. 50,000 jobs? To save shipping costs for small electronic products? Bullshit. This is another Trump lie.
    • by Ksevio ( 865461 )
      Hey it doesn't say they're permanent jobs. Maybe 10,000 jobs to construct the factory plus 10,000 jobs that get created from the economy of those construction workers having jobs and then 3,000 temp workers that work for a couple months. After a couple years you've easily got "50,000 new jobs"
  • Them there's the weasel words.

  • Full circle (Score:5, Funny)

    by bickerdyke ( 670000 ) on Wednesday December 07, 2016 @09:52AM (#53439735)

    So shifting jobs to low wage countries has come a full circle.

  • First, it wouldn't surprise me if Apple wasn't involved in this from inception on the grounds that rival companies have been copying Apple within weeks of a new product release if not before. Ergo, Foxconn in China must be the leakiest place on the planet. China is also one of the worst places for intellectual property rights. So, by manufacturing in the U.S., Apple might be able to maintain control over the IP. Maybe.
    Second, with regards to people laughing when Trump initially said that Apple would be

  • 70 million? 700 million? How many US firms is this displacing, this time? How many US employees is this indirectly putting out of work? Simple answer: More than the gain, because that is part of the definition of inefficiency and is what happens when political policy drives against real economic development.
  • But who's gonna be making the nets to be used to catch people jumping from the windows?

You are always doing something marginal when the boss drops by your desk.

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