'

Foxconn mulls over potential of branching out into solar industry

To lessen its reliance on tech giant Apple, Foxconn is considering the manufacturing potential of solar panels.

When most of your revenue is dependent on another company, its time to seek out alternative ways to generate revenue in case ties are cut in the future.

That may be the thinking of Foxconn, the world's largest manufacturer. Based in China, the company is responsible for supplying Apple with the components necessary for products including the iPad and iPhone. As smaller rival Pegatron secures contracts from the tech giant, over-reliance on Apple may not be the best business plan (the Zynga and Facebook fracas comes to mind).

As a result, Foxconn will decide by year-end whether to move into another lucrative industry -- the production of solar panels in China. The the price of panels has dwindled in the past two years and over-capacity has caused problems, but some analysts believe production is showing signs of stabilising -- and so entering the market now could be a clever move on the manufacturer's part.

Foxconn has been testing its Fox Energy solar unit for the last two years, and has one small solar panel factory in China.

"We aim to make a decision about whether or not we will enter this market by the end of this year,” Foxconn spokesman Simon Hsing told Reuters. "We believe renewable energy is a potentially good trend. It looks like a good project. This is an industry we probably need to know more about."

Apple accounted for 60 percent of Foxconn's revenue last year.

Via: South China Morning Post

Image credit: Apple

This post was originally published on Smartplanet.com