According to Chen Weiliang, president of Foxconn International, Foxconn will move its factories from Shenzhen to northern Chinese provinces such as Hebei and Shanxi where the average salary is more than 60% lower than that of Shenzhen, to save costs.

However, Chen says that Foxconn will maintain the R&D operations of smartphones in Shenzhen. In addition, it will open new factories in low-cost markets like Hungary and India to reduce the pressure caused by cost increases.

Chen says that Foxconn will seek active expansion in the field of smartphones this year. He says that there is big potential in the smartphone field, and the company has hired 700-800 smartphone engineers in the first five months of the year and will increase their salary budget by about 50%.

Chen also disclosed to local media that Foxconn will increase its production capacity by at least 25%-30% in 2009.