We last blogged about Foxconn– one of China’s and the world’s largest manufacturers–when Businessweek featured the 
company as its cover story last September. Known as the “consumer electronics assembler of the world, this giant firm makes products for nearly every major electronics company. Its customers include Apple (iPads and iPhones), Acer (PCs), Amazon (Kindles), Cisco (networking gear), H-P (printers and PCs), Dell (PCs), Motorola (phones), Microsoft (Xbox systems), and Sony (Playstations). The headlines at that time centered about working conditions at Foxconn, where almost a dozen employees committed suicide last year.
So yesterday’s headline in The Wall Street Journal (May 24, 2011), “Factory Blast Roils Tech Supply Chain” raised a number of concerns, especially at Apple, whose iPads are reportedly made at the same Hon Hai plant in southwestern China. (Apple, concerned about even rumors of supply chain disruptions for the popular iPad2, would not acknowledge that the product is manufactured there. The original report came in a leak to the Washington Post 2 days ago).
In the blast at the relatively new Hon Hai plant, 3 workers were killed and 15 injured, and the safety practices at Foxconnn are being raised anew. Labor rights groups had already warned the factory about hazardous working conditions , including aluminum dust floating in the air because of a process that workers use to polish iPad cases. The combustible dust, a recognized risk in electronics manufacturing, appears to be the cause of the explosion. Apple had earlier complained to Foxconn about factory conditions, but did not move its contracts elsewhere.
Discussion questions:
1. Why do so many electronics firms contract out their manufacturing?
2. Why is Apple unwilling to confirm where its iPads are made?