Terry Gou lost the gamble! India intervened, and foreign media focused on the Foxconn era or will come to an end
Terry Gou"The bet was lost"！India's action, foreign media attention: the Foxconn era may be over.
Once upon a time, Terry Gou's Foxconn held the cash cow of Apple and developed rapidly, becoming the world's largest iPhone foundry. But the good times are not long, as Apple gradually transferred the ** chain to India, Foxconn is unwilling to give up this cash cow, and also followed a large-scale entry into India. As a result, in this game of the Indians, Guo Taiming lost the bet! The rise of local enterprises, coupled with a series of unfavorable factors such as the labor environment, Foxconn has lost as much as 100 billion yuan in India all year round. This time, Guo Dong miscalculated the chess - can Foxconn's country still be defended?
i) Foxconn's dependence on Apple has increased rapidly.
Foxconn's success in entering the Apple ** chain is like a farmer finally meeting a landlord and making a fortune. Because the profits from Apple's cash cow are so impressive, Foxconn's revenue reached 25 times! Gou's wealth and income skyrocketed. He was like a farmer who found fertile land and became wealthy.
But the good times were short-lived, and over-reliance on Apple also poses a major risk to Foxconn. As Apple gradually shifts orders and ** chains to India, Foxconn's overcapacity situation is becoming increasingly severe. Just as a farmer depends on only one fertile piece of land, once the land is barren, he will immediately fall into trouble.
b) Foxconn's expansion in India High-profile propaganda is difficult.
In order not to lose this one"Cash cow"Foxconn followed Apple's lead and entered the Indian market strongly, trying to get more orders by increasing investment and expanding scale. However, India's employment environment is too different from China's, product quality is difficult to guarantee, and accidents are frequent, which seriously affects production capacity.
It's like a farmer who has worked hard to open up new land, only to find that the soil is full of stones and thorns. Foxconn's high-profile hype about its expansion plans can't hide all the problems and difficulties it has encountered in India.
c) Foxconn's woes have been exacerbated by the rise of homegrown Indian companies.
With the rise of the Tata Group, the Indian company was able to replace Foxconn as Apple's largest company. It has even hired Foxconn employees to bring in technology and fully develop its capabilities.
It's as if the local farmers learned to farm, began to compete with foreign farmers like Foxconn, and kept stealing from Foxconn, becoming stronger and stronger. Foxconn's days in India are going to get harder and harder.
d) Foreign companies abandon Indian projects and Foxconn suffers.
After a series of setbacks, Foxconn finally abandoned its plans to invest millions of dollars in India. At the same time, the Tata Group has announced a series of investment plans totaling billions of dollars.
This was undoubtedly a blow to Foxconn, which was only worse when local farmers began to buy more land to improve agricultural production, while foreign farmers' fields became more and more barren. Is this really the twilight of the Foxconn jungle in India?
i) Why does Foxconn attach so much importance to the Indian market?
The reason why Foxconn attaches so much importance to the Indian market is mainly because Apple's orders and ** chain are shifting to India in large numbers. In order not to lose this cash cow, Foxconn can only follow Apple to India. But labor costs are lower in India, and the cost of food grown on farmland is also lower. Therefore, Foxconn must also enter the Indian market on a large scale to gain a larger share of orders.
ii) Why can Tata replace Foxconn?
As a homegrown Indian company, Tata understands the local environment and policies. There are also many incentives in place to support local companies. This has created favorable conditions for the rise of Tata. As a foreign-funded enterprise, Foxconn does not understand the environment, but it also misses out on policy dividends. Just as local farmers are better at cultivating their own land, foreign farmers are hitting a wall at every turn.
c) Are Foxconn's days really over?
Although Foxconn has been losing ground in the Indian market, its roots in China remain deep. China remains the world's largest production base for high-end electronics and Foxconn's home base. Orders from Apple and other Chinese companies will remain significant in the coming years. Therefore, for Foxconn, the Chinese market is the lifeline. India's fiasco may not be the end of Foxconn, just as a farmer's failure on newly cultivated land does not mean he is destitute.
The incident quickly sparked heated discussions among netizens. Some netizens believe that Gou's ability is insufficient, the Indian environment is complex, and it is not easy for foreign-funded enterprises to gain a foothold in India. However, some people in the industry believe that despite all the difficulties encountered by Foxconn, its strength is still very strong, and it is hoped that it can gradually adapt to the Indian environment and eventually develop and grow. There are also some industry insiders who are inclined to Apple's view, believing that the rise of Tata is exactly what Apple hopes and can promote the development of India's ** chain.
As we have seen in this incident, the risks of over-reliance on a single client and a single market are enormous. Gou also admits that this is a good lesson. In the future, Foxconn will have to expand its customer base even further, not just Apple. On the other hand, even if the Indian market fails, the Chinese market is still Foxconn's territory and base. The loss of some of Apple's orders had a limited impact.
In reality, it is not an easy task for foreign companies to set up a company in India. Cultural differences, political constraints, and environmental complexity are all obstacles. Foxconn didn't happen overnight. In the coming years, it will have to gradually adapt to the peculiarities of India. At the same time, we must also be wary of local companies, especially competitors like Tata, as they are strongly supported by the **.
So, for Gou and Foxconn, India and China will continue to go hand in hand. It is unrealistic to be too pessimistic or optimistic. Maintaining the original intention of providing industrial services and replicating the Chinese experience in India may be the main axis of Foxconn's India strategy.
It can be said that Gou's bet on India was miscalculated. But there is no need to be too pessimistic, after all, Foxconn's strength is still there. As for whether Foxconn's rule will really come to an end, there is still time to test. We also expect Mr. Guo to learn from the setbacks, adjust his strategy, and create Foxconn's brilliance again. After all, the entrepreneurial spirit of serving the country through industry is not only related to the success of individuals or enterprises, but also to the fate of the country.