Apple’s iOS devices (the iPhone, the iPad, and the iPod touch) are selling at pretty ridiculous rates, and the growth isn’t slowing down either. If you look at the trends, iPhone shipment volumes grow 100% year over year every quarter. When it comes to the iPad, that figure is closer to 150%. How does Apple make all that stuff? Well, they don’t, they get Foxconn to do it for them, but you already knew that. What’s news is that Foxconn is going to blow around $210 million on a 430,000 square foot factory that’s dedicated to Apple products. Said factory will employ 35,800 employees. According to China Daily, this factory will output $1 billion of Apple products every 12 months. That sounds like a lot of money, but during the first three months of this year Apple had over $39 billion worth of revenue. When will this factory be up and running? Construction is set to begin in October, so we imagine it’ll be done in early 2013, though that’s just speculation on our part.
The more important question is how much influence will Apple have towards the construction and the conditions within this shiny new plant? We all know about the suicide nets, the long work hours, the dorm room apartments, that explosion last year, and how much bad press Apple has received because of all that. Will Apple CEO Tim Cook put his foot down and demand that things improve? If so, is he willing to swallow lower margins?
Here’s another thing to consider: How many companies can fly to China and ask Foxconn to build them a factory dedicated to making their products? Not many. Is that a good or a bad thing? We have no idea, but it’s telling that Foxconn has single digit margins whereas Apple maintains the same sort of margins that most software companies have.