TAIPEI (Standard&Poor's) June 10, 2010--Standard&Poor's Ratings Services said today that its rating on Hon Hai Precision Industry Co. Ltd. (A-/Stable/--) would not be immediately affected by substantial increases in the wages of the company's production-line workers in mainland China. On June 6, 2010, Hon Hai announced that it would raise the monthly base wage for the production-line workers by about 67% effective from Oct. 1, 2010. The company had already announced an increase of about 33% in workers' salaries one week earlier. We expect the wage hike will inevitably pressure the company's margin over the next few quarters. However, we believe Hon Hai's ability to relocate its capacity to low cost areas in China, management's efforts
