Foxconn Plans To Use 1M Robots In 3 Years

Taiwan's Foxconn Technology Group, known for assembling Apple's iPhones and iPads in its China factories, plans to use 1 million robots within the next three years to replace workers performing some simple procedures, its chairman said.

Foxconn, which has been plagued by a spate of workers' suicide in its Chinese factories since late last year, plans to use the robots for simple assembly line tasks, Gou was quoted as saying by the China Business News.

A source close to the company confirmed the comments, adding that Gou made the comments in a speech prior to a staff event last Friday.

Foxconn has about 10,000 robots in use now, and will increase the number to 300,000 next year and 1 million in three years, Gou was quoted by the paper as saying.

Analysts said rising labour costs in China were prompting some contract manufacturers in China to switch to more automation.

"Rising salary costs should be the key reason why Foxconn is doing this. This year's wage increase has been quite significant and I don't expect the pace to slow down next year," said C.K. Lu, a Taipei-based senior analyst at research firm Gartner.

"If they don't do this, they will have to move their factories elsewhere."

Since last year, China has been struck by a series of labour-related issues, such as high-profile strikes and suicide cases at well-known companies as heady economic growth fuelled the need for wage increases.

In southern China, auto and parts factories owned by Japan's Honda Motor and Toyota Motor Co went on strike

The firm, which has seen a series of worker suicides, has been criticised by labour rights groups for harsh labour practices.

Foxconn employs about 1.2 million workers, 1 million of which are based in mainland China, the China Business News said.

Late last month, a worker fell to his death at a Foxconn manufacturing plant in southern China, local media reported.

The worker's death was the latest in a series of apparent suicides by young migrant workers at its factory complexes in the past two years.

Other than Apple, Foxconn also counts Dell, Hewlett-Packard, Nokia and Sony Ericsson among its clients.

On Monday, Foxconn's listed flagship firm Hon Hai Precision saw its Taiwan shares rise 3.28 percent, while its cellphone maker unit Foxconn International's Hong Kong shares increase 3.94 percent.

(Reporting by Lee Chyen Yee in Hong Kong, Clare Jim in Taipei and Melanie Lee in Shanghai; Editing by Jacqueline Wong)