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Plans for $10B WI Plant Now Unknown

Tuesday, February 5, 2019

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Shortly after reporting that everything was on budget and schedule for its $10 billion Wisconsin campus, Foxconn Technology Group is now saying that it is reconsidering the kind of facility it’s building.

Project History

In April 2018, Foxconn named Providence, Rhode Island-based Gilbane Building Co. (which has a Milwaukee office) and global firm M+W Group (Stuttgart, Germany) as its lead contractors on the 20 million square feet of building space in Racine County, Wisconsin, that will eventually house a flat screen manufacturing complex and employ 13,000 people.

Officials announced the first round of contracts in early July, worth $14 million, that went toward a multi-purpose building on the site that the company says is now complete.

Nadkachna, BB-CY-SA 3.0, via Wikimedia Commons

Shortly after reporting that everything was on budget and schedule for its $10 billion Wisconsin campus, Foxconn Technology Group is now saying that it is reconsidering the kind of facility it’s building.

Later that month, officials awarded nearly 40 more contracts, though those financial terms were not disclosed at the time.

Most recently, in a Jan. 17 letter, the company disclosed that it would not make the threshold of job creation needed in order to receive about $9.5 million in tax credits.

Foxconn is under an agreement with jobs agency Wisconsin Economic Development Corp. to create up to 13,000 jobs over the course of construction, which would then qualify the company to be awarded up to $3 billion in tax credits.

The contract with WEDC extends well beyond the completion of construction, however. Over the first 15 years of the contract, which ends in 2027, the minimum hiring number dips to 10,400 and the company must continue employing that many people through 2032.

What’s Happening Now

According to a report by Reuters, which spoke to Louis Woo, special assistant to Foxconn Chief Executive Terry Gou, the company will now focus on creating a “technology hub” rather than LCD manufacturing.

While it promises to maintain the numbers in terms of job creation, the type of jobs that will now be up for grabs will reportedly be totally different, and will include more research and development and design positions rather than manufacturing jobs.

Woo cited the cost of labor in the United States for the shift.

The shift is getting attention because the manufacturing jobs were a point of pride for the Trump administration, as well as the catalyst for a package of about $4 billion in government incentives for the company under former Gov. Scott Walker.

According to reports, there have been no attempts to renegotiate the contract despite the changes.

   

Tagged categories: Asia Pacific; Construction; Good Technical Practice; Government; Jobs; North America; Ongoing projects

Comment from Jim Black, (2/5/2019, 8:54 AM)

I think this why he is known as former Gov. Scott Walker. Money was taken away from northern Wisconsin road projects and given to the southeastern corner of the state, this always has caused a division.


Comment from Jeff Laikind, (2/5/2019, 9:35 AM)

FoxConn is used to getting billions in incentives from China (check the NYT article in 2016 "How China Built ‘iPhone City’ With Billions in Perks for Apple’s Partner"). This looks like a standard extortion to get what they want without paying for anything.


Comment from Chuck Nizzi, (2/9/2019, 2:15 PM)

How Wisconsin could be so stupid is beyond me. Living in NW Wisconsin and seeing the political greed that Walker's bunch jumped at thinking they would actually get those jobs and votes is way beyond my reasoning. And I voted for Walker twice... Yup the third election killed his political career. When folks can see through the smoke and mirrors of FoxConn and politicians can't, it is time for those politicians to fall by the wayside. But that happened far too late...


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