Pass Foxconn to Restructure Nearly 30% of Employees in the CMCSG Division
Informed sources said that as Foxconn is expanding production capacity at the Chongqing production base, adjustments to the CMMSG Division will start from the Shanghai branch. In July, Foxconn will transfer all production capacity of HP laptops to Chongqing's production base.
Not long ago, Foxconn's competitor Flextronics International had hinted that it might withdraw from the ODM/OEM notebook market because of the low profit margin in that market. Foxconn's restructuring of the CMCSG division may mean that it will also modify its OEM notebook business strategy.
Foxconn has been in the OEM notebook market for two years. Although it has increased profits through component supply businesses such as PCBs (process control blocks), network modules, backplanes, connectors, and thermal modules, the overall laptop assembly business is still in Loss status.
In fact, Foxconn restructured the CMMSG division as early as expected by the industry. Since Mr. Gou Ting, Chairman of Foxconn, recently stated that in order to improve his performance, Foxconn has suspended the five-year plan to focus on the development of high value-added products.
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