Foxconn denies it’s scrapping LCD TV production at its new Wisconsin plant
Foxconn Technology Group is rethinking — but denying it will scrap — plans for a Wisconsin factory intended for the production of cutting-edge liquid-crystal display panels. The factory was part of a promise by the Taiwanese company to create 13,000 jobs in the U.S.
Foxconn, best known for assembling iPhones, is considering what liquid-crystal display technology is best suited to the $10-billion plant, Louis Woo, special assistant to Chairman Terry Gou, said Wednesday.
“Given global economic conditions and the trade tensions between China and the U.S., we have to be responsible to our employees and customers, and it’s impossible that we can always stay committed to our original plan without any change,” Woo said. “There is no scrapping of our plans. We are upholding our commitment to Wisconsin.”
Woo’s statement contradicted an earlier report that the company might abandon plans for LCD production. Reuters reported that Foxconn instead intended to turn the facility into a base largely for engineers and researchers that also would produce specialized industrial, healthcare and professional products.
“In terms of TV, we have no place in the U.S.,” Reuters quoted Woo as saying. “We can’t compete.”
Such a move could undermine promises to create 13,000 jobs at a project hailed by President Trump for reviving American manufacturing despite the higher cost of operating on U.S. soil.
Foxconn and Trump unveiled the Wisconsin project with much fanfare in 2017 as the company extracted a raft of incentives from the state, although some were forfeited last year after the company fell short of hiring goals. A groundbreaking ceremony in June was attended by the president.
Gou’s company, based in Taipei, Taiwan, is in a particularly precarious position as the U.S. and China wage an escalating battle over trade. It does most of its manufacturing in mainland China, sells products to Americans and faces pressure from both sides to maintain or create new jobs.
Doubt has been growing about Foxconn’s ability to meet its hiring commitments. Gordon Hintz, minority leader in the Wisconsin State Assembly, expressed concerns that Foxconn would fall far short under a deal regarded as the richest tax-credit, exemption and subsidy package in state history.
In a letter to the Wisconsin Economic Development Corp., Foxconn confirmed it missed job-creation targets for 2018.
Foxconn, Apple Inc.’s main manufacturing partner, is also dealing with a slowdown in demand for iPhones. Its main listed business, Hon Hai Precision Industry Co., gets about half its revenue from Apple, which is struggling to stanch declines in revenue, particularly in the pivotal Chinese market. In November, Bloomberg News reported Foxconn was planning a steep reduction in its 2019 expenses.
Foxconn assembles a range of products including iPhones, laptop computers and Sony Corp. PlayStations at factories in China and around the world. Beyond the slowing smartphone market, it’s grappling with an uncertain economic climate as U.S.-Chinese trade tensions escalate. Hon Hai in November posted earnings about 12% below expectations.
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