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Foxconn, the largest exporter out of China and a major assembler of Apple (AAPL) products like the iPhone and the iPad wants to set up shop in Brazil. Reuters reports the company is considering a $12 billion investment in Brazil manufacturing.

The company, the quintessential Chinese manufacturer, is known for its brutal conditions and plant suicides according to Business Insider. Foxconn finds itself at the vanguard of Chinese labor problems, notably inflation and shortages.

Inflation is driving Foxconn out of China

The inflation is driving Foxconn out of China. Reuters says that the Brazilian government and Foxconn are now negotiating a range of details, including facilities location, financing, taxes, broadband infrastructure, and logistics. “We’ve been talking to them for three months,” said Aloizio Mercadante, Brazil’s science and technology minister.

Mr. Mercadente also told reporters Foxconn is planning to begin assembling Apple’s iPad tablet PC at its plants in the South American country by the end of November. “The negotiations are far from complete but I’m confident,” said Mr. Mercadente.

Calls to Foxconn’s spokesperson went unanswered. Apple declined to comment.

Wage inflation in China has raised questions over the country’s future as the preferred outsourcing destination for multinationals in search of cheap labor. Financier George Soros recently told the SFGate that Chinese wage inflation is “Somewhat out of control.” And the Financial Times cites a recent US Bureau of Labor Statistics report which shows that between 2002 and 2008, real hourly wages in China’s manufacturing sector doubled, while they rose by barely 20 percent in the U.S..

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The race to the bottom continues, apparently, Apple believes that $0.80/hour is too expensive for Chinese workers to build iPads. Who is going to buy a shiny new iPad when nobody can afford to buy them because we are all working a McDonald’s?

What do you think?

Could you afford an iPad3 at $0.80/hour?

Will America ever make anything again?

Related articles

• Foxconn in Talks on $12 Billion Brazil Expansion, Rousseff Says (businessweek.com)

 

Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.