Taiwan

"My father was born in Sichuan and lived in Taiwan during his later years. He never forgot his love for his motherland. Whether he was buried in writing books about China early in life or expressing the wish for me to return home while living with me in the US in his later years, I could profoundly feel the deep emotions in his heart. Before he passed away, my father told me by his bedside that he dreamed of picking up a piece of white paper from the water, which had the words “Love for China” written on it. My father’s love for China shook me and gave me the courage and determination to choose."

"In 2020, Foxconn employed nearly [a cool million workers](private://read/01k3jwt46q240aq6fe12mqkyr0/16_Notes.xhtml#_idTextAnchor346) globally. As iPhone production swung into full gear a decade ago in Shenzhen, workers might have seen someone zooming around the campus on a golf cart. That would be Terry Gou, founder of Foxconn (also known as Hon Hai Precision Industry). Gou might start the day by doing laps in the company pool and then drive [his own golf cart](private://read/01k3jwt46q240aq6fe12mqkyr0/16_Notes.xhtml#_idTextAnchor347), specially equipped with a bicycle bell, around the facility until late at night to monitor production. He is legendary in his native Taiwan for his dedication to work. Gou aggressively courted American companies like Dell and Apple to win contracts for manufacturing their products, earning their trust by guarding technical secrets and making products on time, at high quality, in massive volume."

"Many of the United States’ most storied companies have been ailing. Detroit’s automakers, having limped along for decades, are now stumbling through the transition to electric vehicles. US Steel, General Electric, and IBM are shadows of their past selves. Intel, mired in cycles of blown product timelines and layoffs, went from a semiconductor trailblazer to a clear laggard behind Taiwan’s TSMC. After two of Boeing’s 737 MAX jets crashed in 2017, the company promised strenuous efforts to guarantee the safety of its aircraft. Then a door blew off midair in 2024. Boeing, like Intel, is constantly delaying the launch of long-planned products."

"Today, many people call Taiwan’s semiconductor industry the integrated-circuit industry. They are not wrong: the overwhelming majority of semiconductor manufacturers’ products are indeed integrated circuits. However, when it comes to the development of technology, I too am an incurable optimist. I firmly believe semiconductors are endlessly profound; integrated circuits are only their embodiment today. One day—perhaps in a few years, perhaps in a few decades—another invention based on semiconductors will appear. So I like this broader term: the semiconductor industry."

"The new general manager immediately summoned “important personnel” one by one. I had never met him before, but I was also on the list of those summoned. Since joining Sylvania I had never been to the general manager’s office, yet now I had the chance to enter. It was an extremely spacious, luxuriously decorated office, far more lavish than the TI general manager’s office that I would later often enter, and it could even compare with the general manager’s offices of major companies in Taiwan today. The new general manager was very amiable and seemed sincere as well. While looking at a list on the desk, he said only a few short sentences: “I don’t know you, but as I understand it, your performance is good, so you are not among those to be laid off. However, the company needs to lay off about half the staff. Among the four engineers in your section, so-and-so and so-and-so are to be laid off; please inform them. Of course, the company will pay severance according to seniority. Your section will also be dissolved, and the remaining personnel will be merged into another section. Your salary and grade will not change, but from now on please contribute to the company as an individual engineer.” Even though he was amiable and sincere, every word of those sentences was unpleasant to hear. Our section—including me—was five young people; after two years of hard work, what we ended up with was two people being laid off. As for me? The new general manager seemed to think that not laying me off was already a great favor. But although I had not gone to other companies to look for work, I firmly believed that finding a job would not be a problem. I immediately protested on behalf of the two who were being laid off, but it was too late; he had already decided. The two who were laid off were both in their first jobs. Telling them this result was the hardest work of my life; both conversations ended in tears. In the end, the two of them said the same thing: “It seems enthusiasm and hard work still aren’t enough.” Youthful innocence disappeared within a single day, and that lost innocence could never be found again."

"Just as the literary giant Hemingway described Paris as “a moveable feast,” I describe my year at Harvard the same way. After that, I went through various stages—MIT, employment, entering Stanford for a Ph.D., and working at Texas Instruments—but no matter where I went or what I did, I carried this “feast” with me and continually enjoyed the knowledge, interests, and insights that this “feast” gave me. Even decades later, when I returned to Taiwan, although changes in time and place made it feel as if I were in another world, this “feast” still did not lose its freshness. It was as though I were still immersed in a rich, ever-changing, refined, and captivating atmosphere."

"Complementing these executives and staff was a truly distinctive breed of AIG executive, epitomized by John Roberts, called the “mobile overseas personnel” or MOP. This group did service stints in numerous countries during their career, as many as 10 to 15, taking two-to-three year terms in each place. It was almost like the foreign service of the United States. They were corporate ambassadors who became legends within AIG. An experienced MOP could walk into any AIG office in the world, from Taiwan to Santiago, and know just about everyone. Having traveled widely, he could troubleshoot the thorniest problem successfully anywhere in the world, whether obtaining the release of colleagues captured by hostile governments or negotiating with customers perceived to have fabricated claims. The personality type could vary, from the diplomatic to the irascible, the elegant to the brusque. But they tended all to be wise, urbane, and multilingual—cowboys, pioneers, Indians, a cadre of colorful actors that made the company tick."

"The third floor of Inventec’s Taiwanese factory felt perfectly adequate when Apple was shipping iPods in the tens of thousands per month. When orders jumped to hundreds of thousands, it felt comically inadequate. “All of a sudden there were parts not only in the loading dock but up the stairwells in every cavern of that factory,” recalls a product designer. “There were boxes of parts that just literally took over the entire factory building. It was overflowing into the stairwells and emergency exits. There were parts *everywhere*. It went from nothing to ‘Oh my god, there’s not enough space to build these things.’ ”"

"Jobs eventually canceled the other phone ideas and declared multi-touch the future. He was adamant there’d be no keyboard, so the phone would be as full screen as possible. Apple’s engineers suddenly had to find suppliers that could build multi-touch displays at scale—something that didn’t exist at the time. There was no way Apple could send the specs to some factory and wait for the parts to be built; instead, it sent teams of engineers to Japan, Korea, Taiwan, and China to find hungry vendors it could work with to co-create the processes. “There were a few truly groundbreaking mass production processes we were involved with, where we really had to go around to find the best people in the entire world—the peak of what humans have developed for some of these technologies,” says a product manager. By early 2006, they had a full-screen prototype enclosed in brushed aluminum. Jobs and Ive “were exceedingly proud of it,” journalist Fred Vogelstein would later recount. “But because neither of them was an expert in the physics of radio waves, they didn’t realize they’d created a beautiful brick. Radio waves don’t travel through metal well.”"

"The success quickened Apple’s consolidation into China. The low cost of manufacturing played a role, but it was the ubiquity of labor, workers’ flexibility, the presence of “next door” suppliers, and tailor-made export policies that were groundbreaking. “Any time you had some problem or change, you could get a mountain of people to follow you down to the X-ray room or to the testing lab or to the sourcing lab to get materials or parts, or to try some machining or something. It was all right at your fingertips,” says one PD engineer who also worked in Korea and Taiwan. “Anything we wanted, we could get it,” this person adds. “If they didn’t have it, they’d go buy it. We’d send ’em out to the store at two in the morning to get some measurement device or some material to remove something or to apply something so it would work better.” Summing up what made the experience so distinctive, he said, “It was just the total control of those factories and the people there—whatever we needed, it would happen.” A manufacturing engineer recalls trying to get somewhere during a shift change one day, when tens of thousands of people were exiting the factory and heading back to the dorms. “It would take you forty-five minutes or an hour just to go less than a kilometer,” this person says."

"By contrast, Taiwan’s critical, multi-decade role industrializing China through investment and worker training is widely recognized. At least three major books have been written on the subject in English since 2017."

"But if hindsight is twenty-twenty, a former senior designer at Apple says it looks like Beijing’s strategy was to “brain drain” Taiwan, learn everything that is needed, then “cash them out,” and take over."

"But the difficulties in manufacturing were a boon to Apple’s assembly partner and the factories around it. The Taiwanese were learning fast, evolving from taking orders to commanding respect as a genuine partner. Taiwan’s rapid growth led to soaring labor costs and capacity constraints."

"Terry Gou’s bet exemplified his tenacity, ambition, and daring disposition. What made him such a good competitor was his ability to predict his clients’ needs before his clients did. By the time Apple realized it needed to double production of some hit product, Foxconn would’ve already increased capacity by expanding its factory and moving the precision machinery into place. But more than that, the bet demonstrated Gou’s political savvy. When the global financial crisis hit, big investors and entrepreneurs based in Taiwan and Hong Kong retreated from China, a natural response, as demand for goods from North America and Europe sputtered. Gou, by contrast, was willing to invest, and he did so in ways that aligned his political interests with Beijing’s."

"“You have to add in that time cycle—from that part coming from China and into India,” this person says, pointing out that the lower labor costs of India get offset by the added logistics of sending freight from China. Historically, this engineer points out that when Japan, then Taiwan, and then China made their mark in global electronics manufacturing, they all started by supplying components, creating a foundation of technical expertise. Only afterward would a supplier of, say, motherboards, begin to vertically integrate and expand into taking on final assembly, test, and pack out; by contrast, Apple in India has been doing FATP for seven years and is only now trying to build up the competency of suppliers making parts. “My sense of it is, [Apple is] doing it ass-backwards,” this person adds."

"Even Xi Jinping, who seeks to annex Taiwan and has little reason to flatter its citizens, has acknowledged that China’s forty years of opening and reform “has to be chalked up to our Taiwan compatriots and Taiwan companies.” Taipei calculates that between 1991 and 2022, total business investment from the corporate sector exceeded $203 billion, a huge number by any standard—barring Cupertino’s."

"Knoetze first attended a congress on small business in Berlin, where he built up valuable contacts from Taiwan, Hong Kong and South Korea. After visiting each of these countries as well as Singapore and Tokyo in Japan, he returned with a wealth of information about the flourishing small businesses of the Far East."

"In his lecture at the University of Pretoria, he stated that it was necessary to send a ‘young man … with a Polaroid camera’ to places like Singapore, Hong Kong, Taiwan, Florence and Barcelona to photograph and report on what people in small businesses were doing."