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Foxconn invests USD1 billion in Indonesia...It's a tragedy for Foxconn

My only advice is Foxconn will regret later because they do not know the actual investment climate in Indonesia. Many foreign investors be fooled for the cheap labor cost in Indonesia, but they will find out later that Indonesian workers are the “king” to run their factories.

The workers will decide the pay through wildcat strike and using mobs and police to beat up expats.

Good luck, Foxconn. I bet Foxconn will pull out from Indonesia in less than five years.

Foxconn to invest $1 billion in Indonesia for a manufacturing plant
By: Sahil ‘Bones’ Gupta | Jul 19th, 2012 at 01:27PM

Foxconn is slated to invest around $1 billion for a manufacturing plant in Indonesia that is also expected to create over a million jobs in the country. Previously, Foxconn was contemplating between Malaysia and Vietnam for the new plant, but decided against it after looking at the growth rate of Indonesia and its natural resources. Currently, Foxconn is in talks with the Indonesian Ministry of Industry.

Foxconn, of course is not only the world’s largest manufacturer of consumer electronics but is also known for manufacturing fabled Apple products like the iPhone and the iPad, but alongside these products it also manufactures products from Dell, Microsoft (Xbox 360), HP and many more.

The Foxconn plant in Indonesia seems like a perfect fit considering Indonesia is in dire need of formal jobs and has a large pool of cheap labor, with unskilled workers costing as low as $100 per month.

A Foxconn representative said, “We are looking forward to establish a new manufacturing plant in Indonesia although nothing is finalized yet. This will help us in manufacturing good quality products and make them available in the markets at lower prices. With this Indonesians will also get better employment opportunities. We will continue our efforts in establishing more manufacturing plants across the globe.”

The nkkhoo.com comment board with Facebook account.
Guna says:

with your “connection” with Rama of Venture, can you help pass my resume for an engineering job at GES Manufacturing ?

GES Manufacturing Services (M) Sdn Bhd, a member of Venture Group of Companies a provider of advance electronics manufacturing services to original equipment manufacturers with worldwide, world-class operations in China, Singapore, Malaysia and the United States.

nkkhoo says:

Rama is a very nice person who will always find job for friends and ex-colleagues. I only recommend right people I know in person. He fired a lot of deadwood in GES when Venture took over the company.

I will not exploit his kindness to prove my connection.

HOE says:

Nkkhoo
Have you ever witness the Msian Factory Girls goes berserk (Hysteria?) during period moment attracting the “halus” ?
Flextronic worries about compensation should these hysteric workers jump from buildings !

Rama happy of JB operations becoz Indon/Bangla there settle for cheap wages for Venture to hit bottomline every quarter.

nkkhoo says:

Hysteria is very common for Malay operators in local factories. Some Malay operators will suffer hysteria if under intense working pressure, they will not commit suicide unlike Chinese operators. Hysteria is a good channel for them to release emotional tension.

Flextronics hires more foreign workers than Venture. Rama is an Indian, but he did not make Venture another Indian-like company like Penang Flextronics.

Just go compare ROI for Foxconn, Flextronics and Venture to see which company is well-managed. Only those bad managed company blames the workers for their managment problem.

Murugan says:

You may wonder why Foxconn did not invest big time in JB’s PTP (Port of Tanjung Pelepas) industrial area (duty free zone).

The failure of contract manufacturers operating there is one good reason. Just ask Flextronics.

nkkhoo says:

I did ask Venture (Second largest listed company in Singapore) Malaysia GM, Rhama about their factories in JB, he was happy with their operations.

I do not know Flextronics top management in Malaysia, may be you can quote someone you know in the company to prove your point.

Ray says:

MIDA is not doing its part to lure Foxconn.
The fact that the Johor Exco hs been insisting that foreign MNC must set up R&D and collaborate with UTM does not help the cause.

Both Flextronics and Venture in Johor are managed from Singapore, the managers in JB has little decision making power as they are happy with their section manager titles. The Singapore Ops Manager travel in-&-out JB daily to command the factories. You can ask Rhama how much of the finished products are transported to Singapore for shipment, again a failure of PTP. Without the vietnamese and Sarawakian cheap labor, Venture could not maintain its low cost advantage.

nkkhoo says:

To share R&D with UTM is a joke, MIDA thought Foxconn is a social welfare company. No commercial company will share its patented IP.

Foxconn will invest in Brasil to support North America market, Indonesia is a bargaining chip for Foxconn to negotiate better terms with Vietnam and Malaysia.

I know Venture and JB Flextronics are controlled by kiasu who only hired so-so local people in mid management. Two of my ex-colleagues, Rama and another Chinese were promoted to directors in very short period for their “performance” not seen in local people. The big boss like Rama and promoted him to GM.