FOXCONN TECHNOLOGY’S group chairman Terry Gou has cut his long-term growth target for the world’s largest contract manufacturer of electronics by half as demand for iPhones and iPads fails to offset slowing computer sales.
Mr Gou, who founded the Taiwanese company in 1974, is to tell managers that he’s lowering Foxconn’s annual sales growth target to 15 per cent from the 30 per cent set for more than a decade.
“How many companies have grown this big and still grow 30 per cent?” Mr Gou (59) asked. “Fifteen per cent is also big.”
The reduced target, as with the spate of suicides at Foxconn that has kept him in Shenzhen, China, since May, may underscore the challenges of managing a business that generates more sales than Apple or Dell Inc, and employs almost one million workers.
Taiwan’s richest man is planning to expand production in the US and to enter fields such as biotechnology to sustain growth.
“I don’t think investors are ready to hear news of such a big cut in the growth target,” said Vincent Chen at Yuanta Securities Co in Taipei.
"These problems, including lower market growth, are giving Gou the biggest challenge he's ever faced." – (Bloomberg)
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