According to GizChina , FIH, the unit that manufactures Huawei smartphones and operates under the umbrella of Foxconn, has offered new workers at its Shenzhen factory an hourly wage of 26 yuan (approximately $3.60), significantly higher than the 21 yuan per hour wage offered to workers by iDPBG, Foxconn's unit responsible for iPhone production.
Huawei is one of FIH's major customers.
Reportedly, FIH is becoming an increasingly important unit in the manufacturing ecosystem of Huawei and other smartphone manufacturers, but primarily focuses on Huawei's production requirements. Workers recruited by FIH are assigned to different teams based on current needs, with a significant likelihood of involvement in the production of Huawei handsets.
Foxconn's move comes amid fierce manufacturing competition between Apple and Huawei – both companies have recently launched new 5G smartphones in China. With the global push for 5G technology and the growing demand for compatible smartphones, both tech giants are racing to capture a larger share of this lucrative market.
The wage disparity between Huawei's production units and Foxconn's iPhone production highlights a broader trend in the industry. Foxconn is known for its large workforce and manufacturing facilities in China, particularly in cities like Zhengzhou and Taiyuan. But changing market demands, geopolitical tensions, and evolving supply chain strategies have led to shifts in wage structures.
Previously, Foxconn employees could earn substantial bonuses and higher monthly incomes, especially during peak production seasons. However, according to an internal source at Foxconn's labor service company, this year's bonuses may only increase by around 1,000 yuan (US$137) due to reduced orders and lower demand for workers.
Notably, Apple has been actively diversifying its supply chain to reduce its reliance on a single manufacturer and mitigate risks associated with geopolitical tensions. This diversification has led to a reassessment of the wage structure at Foxconn – a company that remains a key partner for Apple but is also expanding its operations to other prominent technology companies such as Huawei.
Foxconn's decision to offer higher wages to Huawei handset manufacturers than to iPhone makers highlights the competitive landscape of the tech manufacturing industry and the dynamics of supply chain development to meet market demand and geopolitical considerations. As Apple and Huawei continue their battle for dominance in the 5G smartphone market, such wage disparities could have a significant impact on the workforce and the entire industry.
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