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Apple and Foxconn to Share Costs on Improving Factories



    In this March 28, 2012 photo provided by Apple, Inc., Apple CEO Tim Cook, center, visits the iPhone production line at the newly-built manufacturing facility Foxconn Zhengzhou Technology Park, which employs 120,000 people. A report released Thursday, March 29, by the Washington-based Fair Labor Association says Hon Hai Precision Industry Co., the Taiwanese company that runs Apple's factories in mainland China, has committed to reducing weekly work time to the legal Chinese maximum of 49 hours. (AP Photo/Apple)

    Apple and its most well-known supplier Foxconn Technology Group, will both share the costs of improving conditions at Chinese factories that assemble Apple's iPhones and iPads, a Foxconn executive said.

    Foxconn chief executive Terry Gou didn't give exact figures, but said that his company has been spending a lot of money to improve the factories which have been deemed to have poor conditions, he told Reuters. Much media attention has been focused on Foxconn employees committing suicide.
    "We've discovered that this (improving factory conditions) is not a cost. It is a competitive strength," Gou told reporters on Thursday  in Shanghai. "I believe Apple sees this as a competitive strength along with us, and so we will split the initial costs."
    Foxconn has been enacting changes at its Chinese factories, even raising wages by 16 to 25 percent and agreeing with Apple to hire tens of thousands of workers to reduce overtime costs. Of course, this has also hurt Foxconn, with shareholders not liking the rising salaries.
    Reported conditions at Apple's Chinese suppliers have been a black eye to Apple, which has spent a lot of time trying to dispel the notion that it is a huge company with sweatshops and unsafe working conditions. Now the company must follow through on its promises to create a safer and better working environment for workers at its suppliers.