Well, Leonard has expended lots of gaseous hot air trying to convince everyone that somehow Apple builds, owns, and operates factories in China in which an extraordinary number of worker suicides have occurred over an extremely short time. He has claimed that I have lied about the facts of this, that my statements Apple does not "build, own, or operate" these factories are false, and he claims that Steve Jobs own statements prove I am wrong. When asked about the suicides at the Hon Hai company's FoxConn Manufacturing facilities, Mr. jobs referred to the events at "their facilities" and said "they had." At no time did Steve Jobs ever refer to the problems at FoxConn as "our" or said "we are doing x" to solve the issue. Steve Jobs did not claim FoxConn's problems as Apple's problems, but they were often portrayed that way in the press. . . and then exaggerated to boot.
In fact, at the time of the suicides, Apple accounted for approximately 15% of Hon Hai's worldwide contracts. . . Assembling some of Apple's products including the iPhone4S and the new iPad.
Leonard claims I don't know what I'm talking about and my facts are not true. He's ignored the links I've provided, or claims I never provide links ignoring the hundreds or thousands of articles I've posted (and linked) to the Apple/Mac/iOS/iPhone PING list in the past ten years. . . with those very facts. Here are some more that shoot down Leonard's idiotic assertions. Note that these articles do not say that it's Apple that builds these competitor products for the other customers of Hon Hai/FoxConn. . . As Leonard would have everyone absurdly believe. *************************
Man who doesn't work for Foxconn kills self. Apple's fault?
By Philip Elmer-DeWitt May 20, 2013: 12:37 PM ET — CNN Fortune
A suicide story that broke on Saturday had fallen apart by Monday.
Anti-suicide nets on a Foxconn factory. Photo: Reuters/Jason Lee.
FORTUNE -- The Agence France Press headline that moved over the business wires Saturday morning seemed like deja vu all over again:
Three new factory suicides at Apple supplier Foxconn
Citing only a statement issued by China Labor Watch in New York, the news agency reported that the deaths occurred at a Foxconn factory in the central city of Zhengzhou and included a 30-year-old married man who died on May 14, a 23-year-old woman (April 27) and a 24-year-old man (April 24).
Although Apple (AAPL) was named in the headline, it wasn't until the fifth paragraph that AFP mentioned that Foxconn also assembles products for Sony (SNE) and Nokia (NOK).
The piece might also have named Amazon (AMZN), Google (GOOG), HP (HPQ), Dell (DELL), Nintendo and Microsoft (MSFT), among others. But it didn't.
And it wasn't until two days later, when the Wall Street Journal reported Foxconn's version of events, that we learned that two of the suicides occurred outside the company's property and were not, according to Foxconn, work-related.
As for the third victim -- the 24-year-old man who died on April 24 -- he didn't work for the company at all. He had, however, applied for a job at Foxconn. As if that makes a difference.
Although the Journal is to be commended for following up, we note that as far as it's concerned, Apple is the only company that matters -- or at least the only one worth mentioning -- when bad things happen in a Foxconn factory town.
As Macworld's Michael Kan once put it: "Foxconn builds products for many vendors, but its mud sticks to Apple."
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NICHOLAS CARLSON
MAY 26, 2010, 9:58 AM — Business Insider
After 9 suicides in 5 months, and reports of brutal working conditions, Apple and Dell say they are investigating the working conditions at Foxconn, the Chinese manufacturer that builds iPads, iPhones and other gadgets.
But while it's obviously a tragedy that any one person, let alone 9, ever commits suicide, let's be clear about one thing: the suicide rate at Foxconn is not particularly high.
In fact, at 5.4 suicides per 100,000 people (400,000 people work at Foxconn), the Foxconn suicide rate is lower than it is in all 50 U.S. states.
In Wyoming, where the population is 512,757, and there are no sweatshops, 22.6 people per 100,000 commit suicide, according to the American Foundation for Suicide Prevention.
In California, the rate is 9.2 – New York, 6.9.
We are not suggesting that working conditions at Foxconn are good. We've seen too much evidence that they are horrible to say that.
It's just that these suicides are not such evidence. If anything, considering these working conditions, it is remarkable the rate of suicide at Foxconn is so low.
Here's Apple's statement on the matter, via Philip Elmer-DeWitt:
"We are saddened and upset by the recent suicides at Foxconn. Apple is deeply committed to ensuring that conditions throughout our supply chain are safe and workers are treated with respect and dignity. We are in direct contact with Foxconn senior management and we believe they are taking this matter very seriously."
Foxconn is putting up nets around its facility to catch anyone that jumps. It's also asking employees to sign a pledge that they will not kill themselves.
Foxconn manufactures iPhones and iPads, as well as assorted Dell products.
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If Foxconn sneezes, does that mean Apple caught a cold?
By Philip Elmer-DeWitt May 28, 2013: 3:45 PM ET— CNN Fortune
The world's largest electronics manufacturer does have other clients.
Source: Asymco.com.
FORTUNE -- If something sounded familiar about Lorraine Luk's headline in Tuesday's Wall Street Journal -- As Apple Feels Bite, Hon Hai Looks to Diversify -- it may be because we've heard that tune a lot lately.
Just in the past three weeks, journalists have attributed to Apple's (AAPL) loss of "steam" everything from Harvard's divestiture of a few hundred Apple shares to the structure of Sharp's survival plan. (See The business wires' new verbal tic.)
To be sure, one can legitimately write that Apple has had an unusually long stretch without a product launch. Or that its profit margins have pulled back quite a bit from their historic highs. Or that its earnings fell year over year last quarter for the first time since 2003, and are likely to do it again this quarter.
But Apple's all-important iOS shipments, as the chart above shows, are still growing nicely.
So to interpret this quote from an unnamed Hon Hai executive ...
"As our production capacity has grown to such a large scale and existing major-brand customers offer limited order growth, we need to actively expand our client base to help increase our manufacturing volume."
... as referring specifically to Apple -- as Luk did in Monday's Journal -- is to ignore the fact that Hon Hai, better known as Foxconn, has other major-brand clients, and that most of them are hurting.
Take Hewlett-Packard (HPQ) and Dell (DELL), two Window's PC vendors that subcontract their assembly work to Foxconn. How's that business doing? See chart below:
Source: IDC
What about Nintendo, Sony (SNE) and Microsoft (MSFT)? Their game consoles are also assembled in Foxconn's factories:
To see this chart, visit the source article.
Source: MRG Inc.
How about Amazon's (AMZN) Kindle readers? Foxconn builds those things too:
Source: Chitika March Tablet Report
I suspect most of Foxconn's other clients would happy to switch places with a company whose sales can produce a growth chart like the one at the top of this page. So if Foxconn is feeling "pain" -- as Luk writes in her lead paragraph -- perhaps a little more reporting would turn up better reasons than the "competition ... biting into Apple's market share."
Posted in: Amazon, Apple, Dell, Foxconn, Hon Hai, HP, Microsoft, Nintendo
FoxConn's Saga: What Analysts Are Saying
By Mark LaPedus 6/15/2010 06:00 PM EDT
SAN JOSE, Calif. -- Lately, it's been a tumultuous period for Taiwan's Hon Hai Precision Industry Co. Ltd. Hon Hai, the world's largest contract electronics manufacturer (CEM), trades as Foxconn and makes electronic products for such brands as Apple, Dell, Hewlett-Packard and Sony.
As reported, Foxconn International Holdings Ltd. (FIH) recently announced it will more than double the salaries of employees at its factory in Shenzhen, China within months in response to a global outcry over recent worker suicides at the site.
Now, there are unconfirmed reports that FIH may re-locate some operations in Shenzhen to lower cost regions in China. Here's what analysts are saying about Foxconn's troubles:
Impact of salary hikes for Foxconn
Jamie Wang, an analyst with Gartner, said: ''This wage hike may increase Foxconn's operational costs and affect its profitability, but the company cannot afford further tragic suicides, and this action will improve relations with its workers in China and help to deflect potential negativity from its outsourcing clients.
''For now, Foxconn needs to concentrate on handling recent events sensitively, which will affect its cost competitiveness in the short term. However, a continuous focus on improving quality and productivity will be recognized by Foxconn's OEM customers over the long term.''
HSBC analysts Yolanda Wang and Joyce Chen said: ''Following the June 2 announcement that FIH was raising pay for its production workers by 30 percent (from RMB900 to RMB1200) effective June 1, the company announced further significant pay hikes of 67 percent (from RMB1200 to RMB2000) on June 7 for production line workers based in Shenzhen, China (effective October 1).
''In the meantime, the company is reviewing potential pay hikes for workers in other areas of China. We estimate the latest 67 percent salary and wage increases could impact FIH’s operating profit by another 66 percent.''
HSBC analysts Wanli Wang and Carrie Liu, said: ''We cut 2010/11 EPS estimates by 5 percent and 11 percent, respectively, (for FIH) to reflect the further labor cost increase. We forecast 2010 sales will rise 32 percent year-over-year. LCD TV, Apple iPad and 4G iPhone, and (notebooks) are the growth drivers. Desktop PCs and servers are likely to benefit from replacement demand. The risk to our forecasts is rising component prices.
Hon Hai (FoxConn) produces more than 50 percent of global desktop PCs.
The company should be a major beneficiary of the corporate replacement cycle. Hon Hai is the key assembler for Apple iPhone 4G. iPhone will contribute about 15 percent of Hon Hai's total sales in 2010.
Moreover, iPad continues to see strong demand globally. We believe 2H10 unit shipments will grow more than 50 percent vs 1H10. Hon Hai will ship only 2 million LCD TV units in 1H10. The other 4 million units will kick in during 2H10, with new orders mainly from Sony.''
Impact on supply chain
HSBC analysts Yolanda Wang and Joyce Chen said: ''FIH’s pay increase could have an impact on the entire manufacturing supply chain, which shares a similar labour pool, especially in the Shenzhen area.''
HSBC analysts Wanli Wang and Carrie Liu, said: ''The salary increase is a structural issue; we expect it to extend to other manufacturing companies in China. In addition to Hon Hai, Honda and TPV also recently announced plans to raise employee base salaries by 20 percent in China.''
The fallout for Foxconn
Jamie Wang, an analyst with Gartner, said: ''Recent staff suicides and attempted suicides at Foxconn facilities are reported to be related to working conditions, and from a marketing perspective, they have had a very negative impact on the company's standing. A consumer or public outcry could force some major brand owners to move their manufacturing away from Foxconn because of these tragedies, on the grounds of 'nonethical manufacturing.'
Foxconn is considered as one of the better partners, providing lower production costs, fast delivery, reliable-quality goods and very high volume capacity. Its business partners will expect the turmoil to eventually subside, and most of them may choose to stay with Foxconn. Nevertheless, OEM clients may use more electronics manufacturing service (EMS)/original design manufacturer (ODM) suppliers to split the production loads, as Foxconn reduces the working hours of its labor force.''
The fallout in China
Jamie Wang, an analyst with Gartner, said: ''Foxconn's suicide tragedies can act as a warning and a lesson to all manufacturers with huge labor forces in China, as they may encounter similar difficulty if they engage in comparable practices.
''Labor management in China is getting increasingly difficult, and all OEM/EMS/ODM companies should take the matter seriously. A shortage of workers in China means that there is a higher likelihood of more unreliable young workers and susceptible recruits being employed in the industry -- all of which pose a significant risk to companies.''
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For those who still insist, like Leonard, that Apple plays games with their taxes, here is a transcript of Apple's CEO Tim Cook's sworn testimony before the US Senate from May 12, 2013:
Apple's CEO senate testimony Transcript PDF.
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There are dozens of other articles and papers I've read on this subject. . . I'm not going to post more. These are sufficient to do the job.