Foxconn looking to partner with local brand: Minister
Paper Edition | Page: 13
Industry Minister MS Hidayat said on Wednesday that the Taiwan-based Foxconn Technology Group was looking to partner with a local electronics producer with a strong brand presence in Indonesia.
Foxconn is the world’s largest electronics manufacturer, supplying components to major clients such as Apple Inc., Dell Inc. and Microsoft Corporation. The company accounts for 40 percent of worldwide electronics output according the New York Times.
Hidayat said Foxconn’s technical team would come to Indonesia next week to visit an area in Banten province allocated for the firm’s production facilities, which are estimated to eventually span over 500 hectares.
“For the initial phase, it will take up around 50 hectares of land in areas near Jakarta,” he said, but declined to point out a specific location.
The firm might ground break its project in December as it aims to produce and sell its products in the middle of next year, he said. “Foxconn wants to invest as soon as possible, even within the next one or two months.”
Hidayat said Foxconn was looking for an Indonesian partner that already has a brand with a “strong presence in the domestic market and proven quality”.
A source who requested anonymity told The Jakarta Post on Wednesday that Foxconn had communicated with several local players, including PT Hartono Istana Teknologi, the manufacturer of consumer electronics under the Polytron brand.
Hartono Istana Teknologi is controlled by Michael Bambang Hartono and Robert Rudi Hartono, two of Indonesia’s richest individuals according to Forbes. In 2012, their assets were valued at US$6.5 billion and $6.3 billion, respectively, through their ownership in PT Djarum, one of the largest tobacco companies in Indonesia, and as the biggest shareholder in Bank BCA, the third-largest Indonesian lender and the largest by market value.
Polytron spokesperson Santo K. Dirjokusumo denied any knowledge of such a plan. “It’s not true. There hasn’t been any information internally about that.”
Polytron is Indonesia’s biggest electronics brand with products ranging from LCD televisions, refrigerators, gadgets and more.
The brand recently launched smartphones, the Genio Series and Glozz Series, and smartphone, the Graffiti series.
Indonesian Employers Association (Apindo) chairman Sofjan Wanandi said Foxconn’s entry into Indonesia would totally change the landscape of Indonesia’s electronics industry, citing a drop in component imports and an improvement in local human resource development.
At present, Indonesian electronics manufacturers depended largely on imported components, particularly from China, with much of the production process stopping merely at assembling.
International Data Corporation (IDC) market analyst Darwin Lie earlier said that Foxconn’s presence in Indonesia would cut prices of certain devices significantly.
Founded in 1974 by Terry Gou, its current CEO, Foxconn is headquartered in Taiwan and operates a number of factories in Asia, America and Europe. The company is the biggest private employer in China, with more than 1.2 million workers.
Selected comments will be published in the Readers’ Forum page of our print newspaper.