While the weekend came and went without the
realization of doomsday, last Friday likely seemed like hell on Earth for
workers at Foxconn Electronics Inc.'s Chengdu plant.
On Friday explosions ripped through the plant,
which has been labeled as one of the key assembly locations for Apple Inc.'s (AAPL)
iPad 2. Early reports indicate
the explosions were triggered by a buildup in flammable dust over the polishing
workshop of the plant.
As of Sunday, three employees died and fifteen
others were hospitalized. Of the hospitalized employees six have been
released, but nine remain in the hospital, several of which are in critical
The move is the latest setback for the troubled
Taiwan-owned gadget manufacturer. Foxconn is a subsidiary of Hon Hai
Precision Industry Co Ltd. (2317).
Foxconn draws its labor primarily from the vast population of mainland
China. It is China's largest exporter and counts companies like Microsoft
Corp. (MSFT), Sony Corp. (6758), Nintendo
Co., Ltd. (7974), Dell Inc. (DELL),
and Hewlett-Packard Company (HPQ)
But its biggest client is Apple, who has relied
heavily on it to produce its Mac computers and popular i-device lineup.
Pressured by Apple to deliver better products at
higher quantities and lower prices, Foxconn turned up the heat on its employees
last year. As a result the company saw multiple
suicides, with employees complaining of "hellish"
The suicides shocked China; while suicide rates in
mainland China are generally quite high, they are unusual among young working
age males, particularly those who have factory jobs. The majority of the
victims were indeed young males.
Foxconn responded with a variety of tactics --
employees not kill themselves, anti-suicide
nets, investigation into replacing
employees with robots, and pay
raises to raise worker morale. The company claims employees
are lying about poor working conditions.
Apple has been pressured about the suicides, but remains
defiant to the suggestion that it somehow was to blame. In
its annual labor audit, Apple praised
Foxconn for working to improve worker conditions in the wake of
The gadget maker refused to comment on its
supplier's latest crisis.
Chengdu is the capital of China's southwester
Sichuan province [Google
quote: The company claims employees are lying about poor working conditions.