Foxconn Mulls Building Plant in WI That Could Employ Thousands

Foxconn, the world’s biggest contract electronics manufacturer, is considering building a plant in Wisconsin, the Associated Press reported Wednesday.

Taiwan-based Foxconn is perhaps best known for its factories in Shenzhen, China, where it assembles iPhones and other personal computing devices sold by Apple (NASDAQ: AAPL). Other customers of Foxconn include BlackBerry, Dell, Nintendo, and Sony (NYSE: SNE).

CNN reported in January that Foxconn had “tentative” plans to build a plant for electronic device displays in the U.S.; if the company moved forward with those plans, it reportedly expected to invest more than $7 billion and create up to 50,000 jobs. The AP reported on Wednesday that the plant in Wisconsin, if built, “could employ thousands of people.”

A spokesman for the Wisconsin Economic Development Corp., the state’s jobs creation agency, said in an e-mail to Xconomy that WEDC “does not comment on pending or potential opportunities.”

President Donald J. Trump visited the Milwaukee area on Tuesday. During a discussion with Wisconsin Gov. Scott Walker, leaders of businesses based in the state, and others, Trump reportedly hinted at the possibility of a large manufacturer expanding into Wisconsin and creating jobs there.

Trump said he and Walker were negotiating with a “major incredible manufacturer of phones and computers and televisions,” according to a Wisconsin State Journal report. “I think they’re going to give the governor a very happy surprise very soon.”

A major theme of Trump’s presidential campaign was his vow to bring jobs in manufacturing and other sectors that had been moved from the U.S. to other countries back home.

Wisconsin lost nearly 3,800 manufacturing jobs from December 2015 to December 2016, the Milwaukee Journal Sentinel reported last week. Still, there are currently thousands of unfilled “production” jobs all across the state, according to the report. That appears to suggest a disconnect between the skills people currently seeking employment have, and the hiring criteria of companies looking to add workers.

According to the AP report, there is at least one other state—Michigan—that has had talks with Foxconn about building a plant there.

Crain’s Detroit Business reported earlier this month that the Michigan Economic Development Corp. and other officials were attempting to persuade Foxconn to invest $4.2 billion in a facility that would assemble display screens. Officials estimated the investment would create 5,000 jobs in Southeast Michigan, according to the report.

Arlan Meekhof, a member of the Michigan state senate, recently implored state officials and business leaders that they should put their “best foot forward so that we don’t lose all of it or part of it to a neighboring state,” in reference to a multibillion dollar investment by Foxconn in a Michigan facility, according to a separate AP report.

A spokesperson for the Michigan Economic Development Corp. did not immediately respond to a request for comment.

The low cost of labor in some Asian countries and in other parts of the world is one major reason so many products sold by Apple and other American companies are produced outside the U.S.

But another key factor is that in a city like Shenzhen, so many of the parts inside iPhones and other devices—glass, screws, and plastic casing, for example—are manufactured in close proximity.

“The entire supply chain is in China now,” a former Apple executive told the New York Times, which in 2012 published a Pulitzer Prize-winning series of articles that looked closely at the production of Apple devices in China. “You need a thousand rubber gaskets? That’s the factory next door. You need a million screws? That factory is a block away. You need that screw made a little bit different? It will take three hours.”

Another article in the New York Times’ iEconomy series examined the “human costs” at electronics assembly hubs in China. Between 2009 and 2011, at least 19 Foxconn workers “attempted suicide or fell from buildings in manners that suggested suicide attempts,” the newspaper reported.

Besides the grueling working conditions that some Foxconn workers have reported enduring, the company has also been criticized for announcing plans to invest in a new facility and create jobs, but failing to follow through.

As the Washington Post reported earlier this year, Foxconn founder and chairman Terry Gou said in 2013 that his company would invest $30 million and hire 500 people to build a factory in Pennsylvania. According to the report, four years have passed and “the factory was never built. The jobs never came.”

Jeff Buchanan is the editor of Xconomy Seattle. Email: jbuchanan@xconomy.com Follow @_jeffbuchanan

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