As US-China relations deteriorate, iPhone manufacturer Foxconn will shift its focus to automobiles.
As it navigates a new era of chilly Washington-Beijing ties, iPhone maker Foxconn is spending big on electric automobiles and redrawing some of its supply networks.
Chairman and CEO Young Liu told the BBC in an exclusive interview what the future may hold for the Taiwanese company.
Even as Foxconn switches some supply chains away from China, he believes electric vehicles (EVs) will fuel the company’s growth in the next decades.
Mr Liu stated that as US-China relations rise, Foxconn must brace for the worst.
“We hope that the leaders of these two countries will keep peace and stability in mind,” Mr Liu, 67, said us in his office in Taipei, Taiwan’s capital.
“However, as a business, as a CEO, I have to consider what if the worst case scenario occurs?”
Possible scenarios include Beijing attempting to blockade Taiwan, which it claims as part of China, or worse, invading the self-ruled island.
Mr Liu stated that “business continuity planning” was already underway, and that some production lines, notably those associated with “national security products,” were already being relocated from China to Mexico and Vietnam.
He was most likely talking to Foxconn servers, which are utilized in data centers and can store sensitive information.
Foxconn, or Hon Hai Technology Group as it is formally known, began in 1974, manufacturing knobs for televisions. With an annual revenue of $200 billion (£158.2 billion), it is now one of the world’s most powerful technology businesses.
It is most known for producing more than half of Apple’s devices, from iPhones to iMacs, but it also works with Microsoft, Sony, Dell, and Amazon.
It has thrived for decades on a script developed by global corporations: they design items in the US, make them in China, and then sell them around the world. That is how it evolved from a tiny component manufacturer to the consumer electronics behemoth it is today.
However, as global supply networks react to deteriorating ties between Washington and Beijing, Foxconn finds itself in an unfortunate position: sandwiched between the world’s two largest economies, the exact countries that have propelled its rise up to this point.
The United States and China are at odds over a variety of issues, including trade and the Ukraine conflict. However, one of the most likely flashpoints is Taiwan, where Foxconn is located.