Taiwan’s Foxconn, the world’s largest electronics maker, said Tuesday that the second half of the year is going “in a better direction” as Shanghai’s COVID-19 lockdown appears to be easing.
“We are very confident in the stability of our supply chain in the second half of this year,” Foxconn President Liu Yongwei said at the company’s annual shareholder meeting.
The Shanghai government will allow all residents of “low risk” areas to return to work from Tuesday.
Liu said Foxconn aims to become the first electric car maker “not short of material supply,” referring to a prolonged global chip shortage that has forced automakers to halt production and hurt smartphone production including for Apple, a customer the main ones.
“A car that costs tens of thousands of dollars can’t be shipped because of a tiny fifty-cent chip. This has been a pain for our customers,” he said.
Foxconn aims to capture about 5 percent of the global electric vehicle market by the end of 2025, and said it hopes to boost its capacity to manufacture EV chips, many of which are low-level integrated microcircuits including those used in energy management.
The company warned this month that revenue from its electronics business, including smartphones, could decline this quarter due to rising inflation, sagging demand and escalating supply chain problems in part due to the shutdown in China.
Foxconn reiterated that China’s strict COVID-19 controls in China have had only a limited impact on production as it kept workers on-site in a “closed-loop” system, as demand for its products suffered in the country as people remained closed.
© Thomson Reuters 2022