Foxconn in talks to begin producing high-end screens for Apple

iPhone assembler Foxconn is apparently hoping to move beyond its relatively low-margin work into more profitable high-end component manufacturing in order to take a bigger slice of revenue from Apple, reports the WSJ. “Apple Inc.’s major assembler Foxconn is in preliminary discussions with a provincial government in northern China for an investment in a new factory that would make high-end screens for iPhones and other mobile devices, people familiar with the talks say.”

Foxconn, the company that assembles the bulk of the world’s iPhones, is in preliminary talks to build a factory in northern China that would make high-end screens for the phones as well, in a sign of the company’s ambition to move up the electronics food chain. Foxconn, formally known as Hon Hai Precision Industry Co. , is discussing a possible investment with the government of Zhengzhou, about 750 kilometers south of Beijing, according to people familiar with the talks. The two sides are discussing terms such as how to divide the investment, which could reach as much as 35 billion yuan ($5.7 billion), the people said. The two sides haven’t yet formulated a concrete investment proposal, they said. If an agreement is reached, it could be Foxconn’s biggest direct investment to date in high-end parts manufacturing.