Foxconn moves forward with construction in Wisconsin

Company now looking at creating a technology hub

By CNN'S VANESSA YURKEVICH CONTRIBUTED TO THIS REPORT.
CNNMoney

(CNN) - Foxconn says it is moving ahead with its construction plans in Wisconsin, despite uncertainty about what it might eventually build there.

The company is now looking to create a technology hub rather than the kind of traditional factory it originally planned, according to a statement. But it does plan to have some kind of manufacturing at the site even if most of the workers it eventually employs there are involved in research and development rather than manufacturing.

Within the next 18 months, it will construct a high-precision molding factory, as well as a system-integration assembly facility. But those are small projects.

Foxconn had originally planned to build a plant that would manufacture large flat screen panels, then it looked at smaller panels used in consumer electronics. Now it is not clear what the final product might be.

The company reported earlier this month that it has finished the first building on the site. Construction continues, although most of the work to date has been site preparation, such as moving 4 million cubic yards of dirt.

Foxconn says it still plans to eventually employ 13,000 workers at the site. But uncertainty about its plans, which the company disclosed this week, is getting a lot of attention. When Foxconn announced plans to build flat screen panels in Wisconsin, it was heralded as proof of manufacturing jobs moving back to the United States.

"The construction of this facility represents the return of LCD electronics and electronic manufacturing to the United States, the country that we love," President Donald Trump said at the time the plant was announced. "That's where we want our jobs. To make such an incredible investment, Chairman Gou put his faith and confidence in the future of the American economy -- in other words if I didn't get elected he definitely would not be."

Part of the attention is because Foxconn is still in line to get $4 billion in state and local government incentives for whatever it does there, as long as it hits the original hiring and investment targets. The controversial package of incentives would be one of the most expensive government incentive packages ever granted to a company.

The package was negotiated under the administration of former Wisconsin Gov. Scott Walker, who was defeated in 2018 in a campaign in which the Foxconn deal was a major campaign issue. Gov. Tony Evers, the Democrat who defeated Walker, issued a statement Wednesday saying his administration was surprised by the reports that Foxconn is changing its plans, and that his administration would "continue to monitor the project to ensure the company delivers on its promises."

But both state officials and and the company denied a follow-up report out of Asia on Thursday that it was Evers seeking to change the incentive package that had caused Foxconn to put its plans on hold.

"There have been no attempts by either the company or the Evers' or Walker administrations to renegotiate [Foxconn incentive] contract," said Mark Hogan, the CEO of the state's independent economic development authority who was appointed under Walker's tenure.

The company reiterated that it still plans to hire as many workers as the original factory plans called for.

"All interactions to date with Governor Evers and his team have been constructive," said the company's statement. "While Foxconn's need to be responsive to the global market environment has necessitated a reconsideration of which technology will best suit the needs of its customers, its commitment to the construction...and the creation of 13,000 jobs in Wisconsin remain unchanged."

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