Start with China. Most of Foxconn’s 1.2 million employees work there. So an automation plan that would replace nearly half the company’s workforce suggests that the cost of those workers is rising. In a press release, the company said mass producing assembly-line type robots was part of its plan to cope with labor shortages and rising wages.
Foxconn has special reasons for speeding up factory automation. During the past 15 months, at least 14 Foxconn workers have died in apparent suicides, most of them in the Chinese city of Shenzhen, where harsh working conditions were said to exist. The company received so much negative publicity and scrutiny from labor groups and clients, Apple in particular, that it began a two-pronged effort to reduce labor costs.
Foxconn has been relocating factories closer to its source of employees, inland China and central Brazil, and is moving ahead with its robot development. The company expects its new robot R&D and manufacturing facilities to create 2,000 jobs in Taiwan. The new robots which will be deployed in China, will allow Foxconn to move displaced workers up the skill ladder to better paying and more interesting jobs. How many workers are kept on is anybody's guess. But with sufficient growth, Foxconn has an incentive to redeploy most of them, which would avoid having to hire, train, and house additional workers as production needs increase.
Foxconn’s move also represents a wakeup call to ABB, KUKA, and Fanuc – the world’s largest robot manufacturers currently. Its plan to develop robots on its own implies that the current lines of industrial robots are not flexible and easily trainable enough for the likes of Foxconn.
Foxconn’s move into the robotics business reflects how things are changing in the industry. The days when industrial robots had a small library of moves but precisely and reliably repeated those moves 24/7 are no longer. New tech is more personalized and manufacturing is following with small quantities of thousands of variants of base products. Robots have to keep up with those changes. At present they have not.