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Gou vows to make Hon Hai 'century-old empire of no sunset'

2016/06/22 20:03:12

Taipei, June 22 (CNA) Hon Hai Precision Industry Chairman Terry Gou (郭台銘) told investors Wednesday that he will not retire until he achieves his aim of building his business group into an empire "on which the sun never sets" that will live robustly into its 100th year.

Hon Hai group is now 42 years of age, Gou said at a shareholder meeting, "and I know it's difficult (for a business) to last 100 years."

He said he will hire many young people and pass onto them "our 40-odd years of experience," as a business with longevity will need senior staff that can share their experience and wisdom with the younger ones.

In share price terms, Gou said he will not retire until his company's share price rises to NT$200, from that day's closing price of NT$81.5. The board of directors has approved his proposal to dole out a dividend of NT$5 per share.

Looking ahead, he predicted that the global economy will sooner or later make a turn from the current "virtual" online trend back to bricks and mortar manufacturing.

His business group's strategy to meet the bricks-and-mortar challenge is to focus on three major areas -- smart homes and living, smart offices, and smart factories, according to the self-made tycoon.

In step with the Democratic Progressive Party government's new southbound policy, Gou said that Hon Hai Group, which has already gone south for three years, will place more resources in Indonesia, Thailand, Vietnam and the Philippines.

India, with a population that is expected to surpass that of China, is another key target of Hon Hai's overseas expansion, according to Gou, who said he has visited India twice and dined with India's prime minister at the latter's home -- a working meal that lasted three hours.

In addition, Hon Hai has research and development facilities in Silicon Valley, Houston and San Jose in the United States, and investments in Brazil and Mexico, where the group employs 20,000 workers.

Hon Hai has also invested in manufacturing and marketing in Czech Republic, Slovakia and Hungary.

However, this does not mean that Hon Hai will give up on the China market. "It does not make sense to abandon a market whose cultural genes are the same as ours," Gou said.

To realize his smart-home goal, Gou said Hon Hai will have to work closely with its newly acquired Japanese partner, Sharp Corp. -- a brand he said he will make good use of.

Hon Hai Group Vice Chairman Dai Cheng-wu (戴正吳), who is likely to take over as Sharp Corp. CEO following a 388 billion Japanese yen purchase of 66 percent of Sharp shares in late March, talked about Hon Hai's plans for running the high-tech corporation.

Dai said he will set up an overseas headquarters -- in Shenzhen, southern China. He will also require all Sharp departments and lines of business to cut costs, get slimmer and turn productive, by making each of the units a "profit center."

Clean energy will be a new direction for Sharp, as will IoT (Internet of Things), as well as smart homes and smart offices, Dai added.

Gou said he and Dai have worked late into the night lately on how to overhaul Sharp, which the Hon Hai team will take over July 1.

Gou said he plans to "get rid of" a downside of Sharp, which is heavily in debt. As Hon Hai, which is known outside Taiwan as Foxconn, has worked since the 2008 financial crisis to strike off its "bad debts, excess materials and extra employees," Gou hinted that the new team will do the same to Sharp.

Once the restructuring has been completed, Gou said, he will speed up the process of turning Sharp technologies into commercial products, cut its overseas operating costs, and "reevaluate" each employee's job performance.

(By Jalen Chung and S.C. Chang)