Flextronics Zhuhai Production Site Expects Double-Digit Growth in 2010

Singapore-based EMS provider Flextronics International expects its production site in Zhuhai, southern China - the largest of the company's production bases around the world - to see a double-digit on-year revenue growth in 2010, according to Flextronics China vice president Fu Jun.

Flextronics' Zhuhai site saw an about 20% on-year drop in revenues in 2009 due to the economic recession, but as the global economy is recovering, the company expects strong orders in April, Fu said.

However, the increasing orders will also pose a challenge to the workforce, according to Fu. The Zhuhai base, with 90% of its employees coming from outside of the southern province of Guangdong, usually loses about 5% of its workforce after the Lunar New Year break. This year, the loss increased to 10% amid a serious labor shortage in China's coastal areas.

But after aggressive hiring, the base's labor shortage dropped quickly to at around 3.6% by the end of February and it plans to hire 2,000 more workers each week in April to help fulfill its orders, Fu noted.

Fu pointed out that the production site occupies a total land area of nearly 900,000 square meters. It currently has a workforce of nearly 44,000 and the company expects to increase it to 55,000-60,000.

The Zhuhai site runs a vertically integrated operation. It can produce 60 million handset PCBs and is capable of producing 8-megapixel digital camera modules. It also makes plastic injection and metal stamping products.

The production site also produces consumer electronics and networking devices including games consoles, desktops, storage devices and servers, Fu noted.

According to market observers, Dell is the largest client for the Zhuhai base's server shipments, while its desktops are mainly shipped to Hewlett-Packard (HP) and Dell. The site is also shipping some PC components to Lenovo. Motorola and Sony Ericsson are both clients for Zhuhai plant, which also makes Xbox 360 for Microsoft.

But Flextronics declined to comment on the observers' claims.

Source: Digitimes, Wax Wang, Joseph Tsai


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