Robots still cost more than the average Chinese worker, although they can work round the clock and do not have issues with management. These chef robots make noodles. (Photo/CNS)
Foxconn, the world's largest contract electronics manufacturer by revenue, is accelerating its automation drive and could deploy as many robots as workers at its China factories within three years, Guangzhou's 21st Century Economic Report says.
The move by China's largest employer and the major contract manufacturer of Apple's iPad, iPhone and other electronic gadgets has been triggered by a shortage of workers, soaring labor costs and problems arising from worker management.
Tso Peng-fei, a research fellow at Taiwan's Topology Research Institute, said Foxconn's workforce was mainly composed of young workers born in the 1990s, who are better aware of their rights and are considered less diligent than their predecessors born in the 1980s and 1970s.
China's census between 2000 and 2010 saw the number of people aged 10 to 14 years fall by 5%. If the trend continues, the manufacturing sector is expected to be hurt by a major new labor shortage around 2015.
With the sharp increase in the sales of Apple's iPhone and iPad, the number of workers hired by Foxconn has risen from 800,000 to 1.1 million, creating difficulties for the management of factories.
Demand for labor also jumped sharply after Foxconn set up iPhone production bases in Zhengzhou and Luoyang in Henan province and Jincheng in Shanxi province.
The report also pointed out that Foxconn has started using a large number of robots as workers last year. Terry Gou, chairman and CEO of Foxconn, had previously said that he was planning to add around 300,000 robots to the assembly line in 2012.
The robot plan has not been implemented as smoothly as expected, with the number of robots being used at only about one-twentieth of the proposed 300,000 automatons needed.
Emissions and chemical substances released from Foxconn's production lines could endanger human health, Tso pointed out, adding that replacing workers with robots on production lines could be a trendsetter. Compared with humans, robots would work round-the-clock without the need for food and accommodation and would not cause management problems.
A representative from a Taiwanese company, which cooperates with Foxconn on the robot business, told the newspaper that Foxconn was widely using robots on its assembly lines at Shenzhen and Jincheng.
The representative added that Foxconn had acquired the robots mainly for its own use and would not sell them to rival contract manufacturers. Therefore, in the short term, other electronics contract manufacturers would have to mainly rely on human resources for their operations.
Currently, the cost of using robots is higher than employing human workers, Zuo said, adding that a robot could cost at least 100,000 yuan (US$15,800) in equipment amortization and maintenance.
The report noted that in comparison, the base salary for an entry-level worker was 1,800 yuan (US$285) per month. If overtime work fees and other payments were added, the monthly salary of a worker would amount, at most, to a meager 3,000 yuan (US$475).