Apple supplier Foxconn raises pay and bonus packages for new recruits at world's largest iPhone factory ahead of next product launch

Apple supplier Foxconn Technology Group has raised the pay and bonus packages for new recruits working at the world's largest iPhone factory in Zhengzhou, capital of central Henan province, several months before the US tech giant launches the next generation of its flagship device.

From Monday, new employees will be entitled to receive bonuses of up to 3,000 yuan (US$424) for at least 90 days of work at the factory, while drawing an hourly pay of up to 21 yuan, according to a WeChat post on Saturday by Foxconn's integrated Digital Product Business Group, which is responsible for iPhone production.

Existing workers at the factory can obtain a referral bonus of 500 yuan, according to the post.

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Taiwan-based Foxconn, formally known as Hon Hai Precision Industry, has already raised worker benefits twice this month. For example, the highest loyalty bonus for new recruits who remain employed for three months was increased to 2,500 yuan on May 22 from 2,000 yuan on May 3.

An iPhone assembly line worker is seen at Foxconn Technology Group's manufacturing complex in Zhengzhou, capital of central Henan province, on November 22, 2022. Photo: Shutterstock alt=An iPhone assembly line worker is seen at Foxconn Technology Group's manufacturing complex in Zhengzhou, capital of central Henan province, on November 22, 2022. Photo: Shutterstock>

Foxconn's Zhengzhou facility, which can house some 200,000 workers, is gearing up for another hectic production run this year ahead of Apple's expected release of the new iPhone 15 models this September.

The higher pay and bonus packages for workers in Zhengzhou underscore electronics contract manufacturer Foxconn's commitment to continue assembling iPhones in the city, despite the ongoing shift of Apple's manufacturing supply chain away from China.

While mainland China remains Foxconn's primary manufacturing base, rising labour costs and disruptions from strict Covid-19 controls last year prompted the company to diversify its production to countries like India and Vietnam.

Apple chief executive Tim Cook in February said that manufacturing disruptions on the mainland in November and December contributed to the company's first quarterly decline in revenue since early 2019, in an apparent reference to the unrest late last year at the iPhone factory in Zhengzhou.

Earlier this month, Foxconn chairman and chief executive Liu Young-way visited Chengdu, capital of southwestern Sichuan province, where he told workers that the company has no plans to leave the city and its "important" production base there.

That followed the Taiwanese firm's opening of a new global business base in Zhengzhou in April, part of efforts to bolster its commitment to the Chinese market.

Still, Foxconn plans to add two more buildings at its iPhone production facility in Chennai, capital of the of the southernmost Indian state of Tamil Nadu, according to a report last month by Mumbai-based daily newspaper The Economic Times.

Foxconn's Liu has already met with Indian Prime Minister Narendra Modi twice in the past year.

Meanwhile, Tata Group is set to become Apple's fourth iPhone contract manufacturer, following the industrial giant's acquisition of Taiwanese firm Wistron Corp's factory in southern India, according to research firm TrendForce, accelerating a shift of production outside China.

India is expected to assemble up to 50 per cent of Apple's iPhones by 2027, up from fewer than 5 per cent at present, according to Taiwan's DigiTimes Research forecast in January. That will put it on par with the scale of production in mainland China, the report said.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2023 South China Morning Post Publishers Ltd. All rights reserved.

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