RACINE COUNTY — The Foxconn Technology Group is planning to adjust its “plans for all projects, including Wisconsin,” according to a statement from the company.
Foxconn on Wednesday issued a statement in response to an interview that Louis Woo, special assistant to Foxconn CEO and Chairman Terry Gou, did with Reuters in which he stated that the company “can’t compete” in the United States when it comes to building TVs.
Woo told Reuters in a story published Wednesday that its plans to build liquid crystal display panel screens in Racine County are being scaled back and possibly shelved.
Woo says the Taiwanese company wants to create a “technology hub” largely consisting of research facilities along with packaging and assembly operations.
Woo says about three-quarters of the jobs created will be in research and development and design, rather than blue-collar manufacturing jobs.
The company would also produce specialized technology products for industrial, healthcare and professional applications, Woo told Reuters.
Foxconn had stated that it plans to build a $10 billion manufacturing campus in Mount Pleasant and has erected a large, multipurpose building in what it calls Area I. There the company was planning to build liquid crystal display (LCD) screens, thin-film-transistor (TFT) screens and other products.
However, Woo said that could change depending on the global market.
A statement issued by Foxconn Wednesday in response to the Reuters report says the company remains “committed to the Wisconn Valley Science and Technology Park project, the creation of 13,000 jobs, and to our long-term investment in Wisconsin.
“As we have previously noted, the global market environment that existed when the project was first announced has changed,” the statement continues. “As our plans are driven by those of our customers, this has necessitated the adjustment of plans for all projects, including Wisconsin. While the project’s focus will be adjusted to meet these new realities, the Wisconsin project remains a priority for our company.”
The Foxconn statement goes on to say the company plans to consider opportunities for the TFT technology to maximize “the positive impact of our Wisconsin project.”
“We are broadening the base of our investment within the State of Wisconsin far beyond what we initially planned to ensure the company and our workforce will be positioned for long-term success,” Foxconn stated.
“In addition to our consideration of plans to produce traditional products such as television sets, we are also examining ways for Wisconsin’s knowledge workers to promote research and development in advanced industrial internet technologies and produce high-tech applications and solutions for industries such as education, medical and healthcare, entertainment and sports, security, and smart cities.”
The statement ends with Foxconn saying it looks “forward to continued investment in American talent as we build the AI 8K + 5G ecosystem we are creating in Wisconsin and the U.S. Further updates will be shared in due course.”
County, Mount Pleasant respond
Racine County, the Village of Mount Pleasant and Racine County Economic Development Corp. responded to the latest developments by issuing a joint statement from County Executive Jonathan Delagrave, Village President Dave DeGroot and RCEDC Executive Director Jenny Trick:
“Contrary to what was reported by Reuters, Foxconn reiterated to us, today, its commitment to building an advanced manufacturing operation in Wisconsin, in addition to its commitment to create 13,000 jobs and invest $10 billion in Racine County.
“As Foxconn has previously shared, they are evaluating exactly which type of TFT technology will be manufactured in Wisconsin but are proceeding with construction on related manufacturing, assembly and research facilities on the site in 2019.”
In the statement the three officials say they understand “Foxconn must be nimble in responding to market changes to ensure the long-term success of their Wisconsin operations. We fully expect that Foxconn will meet its obligations to the state, county and village.
“Both the local and state development agreements are legally binding and include strong protections for taxpayers,” they continued. “The state agreement, which was largely based on job creation, ensures that Foxconn only receives state tax credits if it meets or exceeds its targeted hiring amounts in any given year.
“The local development agreement stipulates that, if, for any reason, Foxconn’s investment on the campus falls short, the company remains obligated to support a minimum valuation for the project of $1.4 billion, which will more than pay for all public improvements and development costs for the project.”
Wisconsin Economic Development Corp. is the state agency in charge of issuing any earned tax credits to Foxconn. Foxconn missed its first opportunity to collect $9.5 million in tax credits this year because it did not hire 260 full-time employees by the end of 2018.
The company has announced it has hired 178 full-time workers and has created over 1,000 direct and indirect jobs.
Mark Hogan, secretary and CEO of the WEDC stated, “Foxconn’s success has been based on the company’s ability to foresee and adapt to technological advancements. Foxconn’s long-term success both globally and within Wisconsin is centered around the alignment of its business model with ever-changing global economic conditions, including evolving customer demands.
“WEDC’s performance-based contract with Foxconn provides the company the flexibility to make these business decisions, and at the same time, protects Wisconsin’s taxpayers,” Hogan stated.
“As has been reported, Foxconn will not qualify for tax credits until, at the earliest, 2020, and then only if the company meets its annual job creation and capital investment requirements. Our ongoing discussions with company officials reflect Foxconn’s continued commitment to the State of Wisconsin.”