Apple and Foxconn offer ABC clarifications on iFactory tour report

The other night, ABC's Nightline got a peek into Foxconn's manufacturing facilities and shed some light on how the iPhone, iPad, and other Apple products are made. The main angle was to investigate the humanitarian conditions of the factories, and though there were certainly some interesting findings, there are a few details that Apple and Foxconn wanted to clarify. The first was regarding Zhou Xiao Ying, who deburred Apple logos from iPad casings. It was suggested that she goes through 6000 units a day, but it's actually half that.

“In manufacturing parlance this is called deburring. Her line processes 3,000 units per shift, with two shifts per day for a total of 6,000. A single operator at Ms. Zhou’s station would deburr 3,000 iPads in a shift.”

The other correction was about Foxconn not paying their employees enough to merit income tax. Foxconn's explanation on that particular was a little more roundabout.

“We have over 75 percent of the employees in the category of earning at least 2,200 RMB ($349/month) basic compensation standard. That means they are earning 13.75 RMB ($2.18) per hour. If they work overtime on the weekend, they will earn 27 RMB ($4.28) per hour. In order to reach 3500 to be taxable, they will have to work 47 OT hours to reach 3,500. If the overtime hours are in weekdays, they have to work around 63 hours per month to reach that level of salary to be taxable. Your statement is only true when applying to the entry-level workers while over 75 percent are already over the probation and earning more than 2,200 RMB basic salary.”

There was also some additional commentary detail from the Fair Labor Association about the flow of conversation before Apple decided to join the group.

"The discussions began in April 2007 but stalled in March 2008. We then resumed them in April 2009 and decided to do a small pilot survey so that Apple could get an idea of how our tools might add value to their program. That pilot led to a second activity that I believe contributed to the decision to join the FLA at the end of 2011. I, of course, cannot speak for Apple but I do believe that the decision to join was probably taken some months before (and therefore well before) the New York Times articles."

The report was definitely an eye-opener. If you've got 15 minutes, be sure to take a look over here.

Source: ABC

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Simon Sage

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Reader comments

Apple and Foxconn offer ABC clarifications on iFactory tour report


Amazing to me that Apple is in the spotlight here. Don't tell me the IBM, Microsoft, HP, Dell, Samsung, Motorolla, etc don't have the same or similar work environments oversees. While I would love to see these jobs shifted to America, you wouldn't and shouldn't get paid 2$/hour or whatever their small dollar wage is. I'm not saying this is right, but they act as if Apple is the only manufacturer that does this. How about we focus on why Apple won't or doesn't bring more jobs back the US where they belong.

I agree that Apple isn't the only one, but they are the biggest single company in this sphere. They're getting all of the heat because the other companies don't come anywhere near the manufacturing demands that Apple does.

Mo-money mo-problems. If Nike or Calvin Klein suddenly became the richest companies in the world I am willing wager their factories would be under the same pressure.

One of the key things ... and why electronics manufacturing is NEVER going to come back to the U.S. (It was barely here anyway.) Is we just don't have the concentration of employees and the ability to mobilize thousands of employees at a drop of a hat. That's what Japan had before them (and continues to have) and that's what China has now. As electronics get smaller and smaller shipping becomes even easier and less of a cost burden. So while sure, GE makes appliances in Kentucky -- only because shipping washers and dryers from China would be prohibitively expensive. Also not nearly as labor intensive. I'd love to see the U.S. put more effort into embracing smaller factories for more specialized work in the U.S. in the way that Germany has but the kind of scale that 1.3B (China) or 127M (Japan) people all on a very systematic schedule employment schedule, living extremely close to their jobs is not the way that we are set up. At least we haven't had those kinds of advantages since the great immigrant waves of the early 20th century.

I disagree to some extent. I do not think it is that hard to mobilize thousands of workers with the current unemployment rate of 8%. Just past this January aprox 129.000 people were layoff in the US. A factory like FoxConn Zhengzhou, which produces for all major companies, has about 130.000 employees, I would estimate a third working on Apple products.
FoxConn has just opened an iPad/iPhone factory in Brazil, and the unemployment rate there is 6.7%. Brazil also imports all parts from the far east, and its still profitable to build there.
I think the availability of people and materials are not a problem, that's just the official line. The problem is the cost of labor, which reduces profits, and complying with US work regulations. Bottom line is that producing in China is cheaper, and since Apple has a fiduciary obligation to its shareholders, it will keep operations in China and Brazil. If it wanted to get a FoxConn factory in the US, it would.

Grubbed suggests that over time, china's economy will rise, wages will go up, and electronics will get more expensive. This won't happen before we take advantage of every country that is under developed. The factories will just keep moving countries, wherever it is the cheapest to make it.
Also, Foxconn needs to have unannounced audits by the fla and other organizations. Their answer to why Foxconn knew when the audits were scheduled was unacceptable and just sounded like something the fla guy pulled out of his ass. It didn't even answer the question. That means the fla and apple are still turning a blind eye to the knowledge that working conditions can be worse when they are not looking, and that underaged workers are working there.

I didn't see the report as a definite eye opener. Honestly, i didn't see any issues. It's a big factory that offers grunt jobs. Lots of people want to work there. They seem happy.

People make a big deal over the wages, but it's above the minimum wage. Why don't people realize that this country does the same exact thing? I worked in a factory job for one year during college. I worked 40-60 hrs per week in pretty rough conditions. I was paid just $1 over minimum wage until my 90 day probation period was up. After that, $1.50 over minimum wage. I didn't see anything wrong with what they're doing. Apple is smart to take advantage of it, and almost every other major company takes advantage of it too. They don't force the people to work there. Who cares. Lets just move on.

How about ever single person that is bitching about working conditions and wages that has an iPhone, iPad or anything else made in China or any other 3rd would country STFU!
If don't like it don't buy it! But don't sit at Starbucks on your iPad with your Nikes and bitch, like you are better then everybody else!