Foxconn changes focus of massive U.S. manufacturing project
January 30, 2019 – Foxconn Technology Group said Wednesday it is shifting the focus of its planned $10 billion Wisconsin campus away from blue-collar manufacturing to a research hub, while insisting it remains committed to creating 13,000 jobs as promised.
The much-balleyhooed facility was heralded by President Donald Trump and former Wisconsin Gov. Scott Walker as a once-in-a-generation opportunity to return manufacturing to the Midwest and the United States. Foxconn, a major supplier to Apple, is the world's largest contract maker of electronics and China's largest private employer.
In a statement Wednesday, Foxconn said it remains committed to the project, the creation of 13,000 jobs and "to our long-term investment in Wisconsin." But because the global market environment that existed when the project was first announced in 2017 has shifted, "this has necessitated the adjustment of plans for all projects, including Wisconsin."
Louis Woo, special assistant to Foxconn CEO Terry Gou, told Reuters in a story published Wednesday that its plans to build liquid crystal display panel screens are being scaled back and possibly shelved.
"In terms of TV, we have no place in the U.S.," Woo told Reuters. "We can't compete."
Woo said a factory would not be built in Wisconsin: "You can't use a factory to view our Wisconsin investment."
Instead, Woo says Foxconn wants to create a "technology hub" that would largely consist of research facilities along with packaging and assembly operations. Woo said about three-quarters of the jobs created will be in research and development and design, rather than blue-collar manufacturing jobs.
Foxconn said in its statement that it was broadening its base of investment in Wisconsin to ensure the company and workforce will be positioned for long-term success. That includes focusing on research and development in advanced industrial internet technologies and producing high-tech applications and solutions for industries such as education, medical and health care, entertainment and sports, security, and smart cities, Foxconn said.
The Taiwan-based company billed the massive 20 million-square-foot (1.86 million-square-meter) Wisconsin campus as its first North American manufacturing site for the next generation of liquid crystal display panels to be used in a wide variety of products, including large-screen TVs, self-driving cars, notebooks and other monitors.
Wisconsin state and local governments promised roughly $4 billion to Foxconn, the largest incentive in state history and the biggest promised by a state to a foreign corporation in U.S. history. Foxconn was required to invest $10 billion and create 13,000 jobs to get the full incentives.
It hired 178 full-time jobs rather than the 260 targeted in 2018, failing to earn a state tax credit worth up to $9.5 million.
A spokeswoman for Wisconsin Gov. Tony Evers, a Democrat who was critical of Foxconn in the campaign against Walker, did not immediately return a message seeking comment. A spokesman for the Wisconsin Economic Development Corporation, which brokered the deal with Foxconn, also did not immediately return a message.
Wisconsin Republican legislative leaders who pushed the Foxconn project also did not immediately return messages Wednesday.
Democratic critics, including Evers, said the incentives promised to Foxconn were too rich and questioned whether the company would ever fulfil its job creation and investment promises. They also said the massive plant that was relying on water from nearby Lake Michigan posed serious environmental risks.
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