Terry Gou

"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."

"The next time Foxconn really demonstrated its ambition and capabilities was for a product Apple hadn’t even commissioned it to build. In the early summer of 2003, Terry Gou’s company invited a group of people from Apple Product Design and Operations to Longhua for some show-and-tell. Gary Hsieh, a general manager at Foxconn whom one industry colleague describes as “a completely rogue entrepreneur,” led the meeting. He unveiled a third-generation iPod—only, it wasn’t made by Apple. It was a replica, made in-house. The Apple people passed it among themselves, marveling at Foxconn’s ability to reverse-engineer the iconic music player. The replica had a different skin on the outside, but the same display, scroll wheel, and buttons. Even how it operated and played music was nearly identical to the real thing. “It was as if our own software-hardware team had built it,” says an Apple engineer who was there. The point Foxconn was making was simple: *If we can build a replica of this quality without your training our staff or sending the official specs, imagine what we could build as real partners.*"

"An electronics client didn’t necessarily understand this, but the reason Terry Gou’s factories had world-class machinery is that the local government had subsidized them, if not outright purchased them. This was part of a quid pro quo with government officials who were judged by, and desperate for, growth. “Uncle Terry,” as Apple would come to know Gou, was more adept than any of his rivals in convincing government officials to provide land and machinery and introduce a spate of policies tailor-made to promote exports."

"The Foxconn officials proposed to help in the development of the next iPod. They offered to do schematic layouts of the factory and perform much of the grunt work, like creating detailed digital models of the needed parts in CAD, or computer-aided design. Because it had such confidence in Apple’s future, Foxconn said it would take on this work for pennies on the dollar. Tony Fadell credits Terry Gou with understanding the value of working with Apple better than anyone. “Terry was all about the relationship. He knew he needed to be with somebody whom he could grow with,” Fadell says. “He just knew that if he had a really good relationship with us, he would be able to grow with it and get the capital he needed to be able to build the infrastructure ahead of everyone. And the other thing is, we trained all his engineers.”"

"The tin roof of Terry Gou’s cramped and cluttered, cement-floored office served a subtle purpose. Foxconn, a Taiwanese contract manufacturer taking advantage of cheap labor on the Chinese mainland, was all about the client. The shabby quarters at Gou’s office indicated that Gou’s clients were getting the best deal. Every dollar he earned was going to the production line, not to marble floors in the reception area."

"The Apple-Foxconn relationship goes back to at least the early 1990s, but in a limited way. Foxconn had been championed by H. L. Cheung, a Singaporean Apple executive from 1981 to 1997, who would later join Foxconn. But Terry Gou’s company was mostly just a supplier of affordable components, like those connecting printed circuit boards to the housing. Apple engineers from the mid-1990s remember it as “the connector company.” But Foxconn quickly expanded its skill set, and approaching the year 2000, it was demonstrating its prowess as a jack-of-all-trades with a model different from the other Taiwanese companies expanding to the mainland."

"In 1999, Foxconn was already building the enclosure for the G4 desktop and supplying components for other Apple computers. Miller recalls Foxconn “just crushing it” in terms of production, cost, and speed, a combination nobody could really compete with. “It was mind-blowing how much manufacturing and tooling capability they had,” he says. “Terry Gou invested a lot of money, setting that place up to be fast and cheap.”"

"The company once again established its hub model for iMac production, bearing the up-front costs. “Apple didn’t own any of the inventory parts that were there. Everything was borne by Foxconn,” says a Czech-based Apple worker. “Apple had zero capital expense or investment.” More than 300 people were hired to run multiple assembly lines, and Foxconn established a giant molding site for the plastic enclosures. Apple teams from Singapore were sent in to train the workers and ensure quality. Apparently smitten with the country, Terry Gou purchased a twelve-bedroom castle near the Czech factory in 2002, for a reported $30 million, and began spending his summers there. The fabulously rich CEO no longer had to worry about tin roofs."

"Rubinstein was floored by Terry Gou’s ability to turn vision into reality at inexplicable speed. In America, he says now, nine months wouldn’t be enough time for a greenfield site to have attained the permits to start building. “These aren’t necessarily bad things, by the way,” he says. “It’s just not the way it is. And so we’re not competitive.” From a distance it appeared that Foxconn could go from zero products to 100,000 *per day* with ease. Other Chinese groups could best Foxconn in quality or match them in time to market—the period between taking a design and building the first batch. But nobody could match Foxconn in time to volume—how long it took to build a product in great quantities."

"The success of the iPod Mini all but assured Foxconn was getting the contract for the next iteration: the iPod Nano. But when Terry Gou invited Jon Rubinstein to Shenzhen to discuss the project, Apple’s hardware chief nearly had a panic attack. “Terry points to an empty lot. And he goes, ‘Here’s your factory.’ ” Rubinstein looked into the distance, his bewilderment turning to anxiety. “I’m terrified,” he recounts. “It’s a typical Chinese field filled with garbage. I’m panicking. And he says, ‘Don’t worry, I got you covered.’ ”"

"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."

"By the end of 2010, the number of attempted suicides rose to eighteen. Foxconn became a household name for all the wrong reasons, and Apple was accused of “iSlavery.” Whatever his other skills, Terry Gou didn’t exactly come out of this crisis looking like a media-savvy CEO. He installed nets all around the factories, to prevent workers from jumping to their deaths, and compelled workers to sign a pledge not to commit suicide. Describing his hopes for the new factories in Zhengzhou and Chengdu, Gou said that workers living inland and closer to their families would feel less anxiety. “There will be hospitals, there will be other facilities, there will be sources of entertainment,” Gou said in September 2010. “And if people still decide to kill themselves, then no one can blame me.”"

"featuring the sayings of Terry Gou, some of which were also plastered on the otherwise bare walls. The aphorisms ranged from inspirational to threatening. “Work hard on the job today or work hard to find a job tomorrow,” said one. “Value efficiency every minute, every second,” said another. “Achieve goals or the sun will no longer rise,” said a third."

"Such tactics accelerated after 2017 but had been going on for years. One former Apple executive recalls, around 2012, being with one of Terry Gou’s top executives when they saw indigenous Chinese companies holding signs outside the Foxconn factory, recruiting talent. “Holy shit, I’m gonna lose my best guys here!’ ” the Foxconn executive exclaimed. Recognizing the two, a top engineer walked over and offered his hand: “It was a pleasure working with you. I’m working for Huawei now.” As the engineer walked away, the two executives were silent for a few seconds. Then the Apple executive turned and said, “Who the fuck is Huawei?”"