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Foxconn to build $10bn LCD plant in Wisconsin

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Foxconn to build $10bn LCD plant in Wisconsin

Technology sector

Foxconn to build $10bn LCD plant in Wisconsin

White House says facility will be ‘first of many’ US investments by Apple supplier

© Bloomberg

Foxconn, the Taiwanese electronics supplier, announced on Wednesday that it would invest $10bn in a new LCD production facility in Wisconsin.

The “state of the art” facility would create an initial 3,000 jobs and be the “first of many” investments the Apple supplier plans to make across the US, a White House official said. Over time, the plant could lead to as many as 13,000 jobs, the official said, calling the deal a “milestone in bringing back advanced manufacturing”. 

Wisconsin would invest $3bn in economic incentives as part of what its governor Scott Walker said was the “single largest economic development project” in the state’s history.

Foxconn’s founder and chief executive, Terry Gou, said the 20m-square-foot “Wisconn Valley” factory would be the “first in a series of facilities”, as it invests in high-speed 5G wireless and higher-definition 8K displays that together with advances in “big data” and artificial intelligence will create an “eyeball revolution”.

If I didn’t get elected, he definitely would not be spending $10bn

President Donald Trump, referring to Foxconn founder Terry Gou

“Why do it here? TV was invented in America, yet America does not have a single LCD fab to produce a complete 8K system,” Mr Gou said. “We are going to change that.”

Taking the podium alongside Mr Gou at the White House, President Trump said it was a “great day” for “everyone who believes in Made in the USA” and claimed personal credit for Mr Gou’s investment. “If I didn’t get elected, he definitely would not be spending $10bn,” Mr Trump said.

LCD displays are a key component of television sets, computer monitors and car dashboards, with 8K resolution - which is still in the early stages of commercialisation - opening up new applications in fields such as medical imaging.

Hon Hai, Foxconn’s parent company, took a controlling stake in Sharp, the Japanese display group, for $3.5bn last year.

The US is Sharp’s biggest market but it has not produced screens locally in the country until now. Foxconn is seeking to diversify as its customers in the smartphone industry, including Apple, have seen a slowdown in sales over the past two years. 

Mr Gou and Tai Jeng-wu, Sharp’s president, met Mr Trump to discuss the potential US investment three times. Several states were competing for the contract, with many offering local tax incentives.

Foxconn’s investment follows last week announcement that Merck, Pfizer and Corning would bring pharmaceutical glass manufacturing to the US, with plans to invest $4bn to create up to 4,000 new high-tech jobs.

Soon after his election, Mr Trump touted a commitment from Japan’s SoftBank to invest half of its planned $100bn “Vision Fund” in the US, creating 50,000 new jobs, even though the fund was originally announced in October, before Mr Trump’s election. 

Amazon promised to create 100,000 US jobs over the next two years and Intel said it would invest a total of $7bn in a new chipmaking plant in Arizona, while Indian IT group Infosys has pledged to hire 10,000 Americans in the next two years. 

In May, Apple announced a new $1bn “advanced manufacturing fund” aimed at boosting its US suppliers. 

In an interview with the Wall Street Journal earlier this week, Mr Trump said that Apple’s chief executive Tim Cook had “promised” him “three big plants, beautiful plants”. It is unclear whether the new Foxconn facility will supply LCD panels to Apple or if it constitutes one of those three. 

“I said, you know, Tim, unless you start building your plants in this country, I won’t consider my administration an economic success,” Mr Trump told the WSJ. Apple, which does not own any of its own manufacturing facilities around the world, declined to comment on Mr Trump’s remarks. 

Apple says it has already created 2m jobs in the US, through a combination of its own employees, suppliers and app developers, and spent $50bn with US suppliers last year.

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