Foxconn cuts plans for Wisconsin plant
By Valerie Bauerlein
Foxconn is scaling back its plans for an LCD plant in Wisconsin, saying it plans to invest a fraction of the $ 10 billion pledged nearly four years ago, according to a new contract with the state.
The electronics maker, officially known as Hon Hai Precision Industry Co., on Tuesday negotiated a new economic development agreement with the state of Wisconsin, which was part of the record-breaking incentive package announced in the summer of 2017. .
Foxconn, the world’s largest contract manufacturer of electronics, now plans to invest up to $ 672 million and create 1,454 jobs by 2025 to qualify for $ 80 million in incentives, according to contract .
The company previously agreed to invest up to $ 10 billion and hire 13,000 people by 2032 to qualify for $ 2.85 billion in incentives.
The Foxconn deal was originally struck by former company president and founder Terry Gou and former Republican Gov. Scott Walker, who lost his post in 2018 to Democrat Tony Evers. The deal was announced in the White House and presented by then-President Trump as a pillar of the administration’s plan to boost manufacturing jobs in the United States.
On Tuesday, Governor Evers said the new contract met his campaign pledge to save taxpayer dollars and protect public investments for the existing plant site south of Milwaukee, where officials have invested hundreds of millions. dollars in roads and other infrastructure.
“I promised to work with Foxconn to make a better deal for our state,” he said. “The last deal didn’t work for Wisconsin.”
Foxconn, a display supplier for Apple Inc., has previously said rapidly evolving LCD technology is complicating projects in Wisconsin. In a recent report, Foxconn said the project had also been slowed down by “cultural assimilation, changing business demands, tariffs, a pandemic and a presidential election year.”
Foxconn media representatives did not respond to a request for comment. But Foxconn officials have previously called for more flexibility on the types of investments that might qualify for incentive payments, which the governor said the new contract provides.
The new contract allows incentive payments for “economic investment activities related to the location and operation of a technological and manufacturing ecosystem”. The old contract required Foxconn to build a specific type of screen manufacturing facility in Mount Pleasant, 40 km south of Milwaukee.
Foxconn has been looking to expand beyond electronics since its founder, Mr. Gou, stepped down in 2019. iPhone sales have slowed and contract manufacturing has suffered from relatively low profit margins. weak.
Foxconn chairman Young Liu said last month that it might make sense to build electric cars at the Wisconsin site, in light of the company’s recent deal with the electric vehicle start-up based in Los Angeles, Fisker Inc.
The cleared and prepared site is larger than Central Park, with nearly 100 homes and small farms bulldozed to make way for Foxconn. For now, the site is home to a few shell buildings and a nearly complete glass and steel dome that can be seen from nearby Interstate 94.
(END) Dow Jones News Wire
April 20, 2021 at 7:21 p.m. ET (11:21 p.m. GMT)
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