Foxconn continues to move to India! Henan\’s imports and exports plummet, mainland media warns of negative chain effects

As the global supply chain withdraws from China, the latest data shows that Foxconn, a subsidiary of Hon Hai (2317-TW), has recently gradually moved to India for development, which has affected the foreign trade performance of Henan Province, mainly due to a sharp decline in mobile phone exports. Foxconn is the main OEM for Apple iPhones and the largest exporter in Henan.

As the global supply chain withdraws from China, the latest data shows that Foxconn, a unit of Hon Hai (2317-TW), has recently gradually moved out to India for development, which has affected the foreign trade performance of Henan Province. The main reason is the sharp decline in mobile phone exports.
Foxconn is the main OEM for Apple iPhones and the largest exporter in Henan.
The General Administration of Customs of China released the import and export data of each province in the first quarter of this year. The number of mobile phones exported by Henan last year was 57.61 million units, an annual decrease of 14.5%. In the first quarter of last year, 16.88 million mobile phones were exported in the first quarter of this year. RMB was only RMB 27.2 billion in the first quarter of this year.
Chinese new media \”Glacier Think Tank\” reported that even though Apple\’s sales in China fell by 19.1% in the first quarter of this year and global mobile phone sales are also declining, the decrease should not be so large. It can be seen that Foxconn is withdrawing some production lines from Henan and if Foxconn really Foxconn will not be the only one to evacuate, which may have negative knock-on effects.
Foxconn is of great significance to the economy of Henan and even China. Last year, the import and export volume of Xinzheng Comprehensive Bonded Zone, where Foxconn is located, reached 407.3 billion yuan, accounting for 74% of Zhengzhou’s import and export, accounting for 50.3% of Henan Province’s import and export.
Among the top 100 export companies in the country, Zhengzhou Foxconn, Shenzhen Foxconn, and Chengdu Foxconn are all in the top 20, and Foxconn has been the number one export company in China for more than 10 years.
Domestic substitution may play the role of a substitute in Apple\’s ecological chain, but it is not a simple substitution game for the economy.
In 2010, Terry Gou chose to establish Foxconn in Zhengzhou, Henan. More than 200 manufacturers in the upstream and downstream supply chains followed suit and landed in Henan. After that, Henan Province\’s electronics industry quickly took shape, and the overall scale of Zhengzhou\’s electronic information industry grew 25 times.
By 2020, Zhengzhou Foxconn has become China\’s largest export trading company, with total annual exports reaching US$31.6 billion.
As a single company, Foxconn contributes 80% of Zhengzhou’s total import and export volume and 60% of Henan Province’s total import and export volume.
Take Zhengzhou Airport as an example.
In the year when Foxconn was officially built, the GDP of Zhengzhou Airport was only 20.6 billion yuan. In 2021, it increased more than five times to 117.2 billion yuan.
At its peak, Foxconn contributed as much as 25% to Zhengzhou’s GDP.
The report finally pointed out that at present, it seems that the gap left by the relocation of Foxconn’s mobile phone manufacturing industry chain can be filled by electric vehicles.
In early January this year, it was suddenly reported that Foxconn would invest 500 million to build an electric vehicle component foundry in Henan and even stated that it would fully cover the OEM of domestic electric vehicle components.
Chinese electric vehicle giant BYD is also increasing investment in Henan.
This kind of transformation in Henan is a rational choice and a general trend.
As we begin to try to get rid of \”Foxconn dependence\”, we should also prepare for the \”Foxconn sequelae\”.

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