Hon Hai Group has announced plans to reduce its global workforce following a significant decline in share loss and net profit.

The troubled company currently assembles and supplies components for a number of major firms, including Apple, Nintendo and HP.

"Hon Hai's job cuts plan is global due to the harsh economic conditions. The worst has not come yet -- the problem is three times worse than everybody thinks," explained Hon Hai Chairman Terry Gou. 

Guo said he expected each department to implement a 10 per cent cut, which would total approximately 50,000 out of 650,000 employees. Gou added that the reduction was necessary to ensure Hon Hai's continued competitive edge.

Meanwhile, a former Hon Hai engineer told the Taipei Times that at least 70 Taiwanese Hon Hai employees have already been laid off. In addition, the Liberty Times reported that Hon Hai's Hong Kong-traded unit Foxconn International Holdings plans to eliminate 1,500 jobs in Hungary and reduce its China workforce by 5 per cent, or 30,000-40,000 individuals.

Hon Hai, which had boasted an annual average revenue increase of 50 per over the past decade, recently posted a decline in its net profit for the second and third quarters of 2008. In addition, company shares lost more than 60 per cent of their value, with most of the decline occuring after the month of August. Similiarly, the share prices of Foxconn International have plunged nearly 85 per cent this year. X

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