Foxconn rethinks plans to make LCD panels at Wisconsin plant

January 31, 2019 09:21
Foxconn may scale back or even shelve plans to make LCD panels at a US facility as it assesses the cost factor, according to a report. Photo: Reuters

Taiwan's Foxconn Technology Group is reconsidering plans to make advanced liquid crystal display panels at a US$10 billion Wisconsin campus, Reuters reports.

The electronics giant intends to hire mostly engineers and researchers for the US campus rather than the manufacturing workforce the project originally promised, the report said, citing a company executive.

Announced at a White House ceremony in 2017, the 20-million square foot campus marked the largest greenfield investment by a foreign-based company in US history and was praised by President Donald Trump as proof of his ability to revive American manufacturing.

Foxconn, which received controversial state and local incentives for the project, initially planned to manufacture advanced large screen displays for TVs and other consumer and professional products at the facility, which is under construction. It later said it would build smaller LCD screens instead.

Now, those plans may be scaled back or even shelved, Louis Woo, special assistant to Foxconn Chief Executive Terry Gou, told Reuters.

He said the company is still evaluating options for Wisconsin, but cited the steep cost of making advanced TV screens in the United States, where labor expenses are comparatively high.

“In terms of TV, we have no place in the US,” Woo was quoted as saying in an interview. “We can’t compete.”

Rather than a focus on LCD manufacturing, Foxconn wants to create a “technology hub” in Wisconsin that would largely consist of research facilities along with packaging and assembly operations, Woo said.

It would also produce specialized tech products for industrial, healthcare, and professional applications, he added.

Earlier this month, Foxconn, a major supplier to Apple, reiterated its intention to create 13,000 jobs in Wisconsin, but said it had slowed its pace of hiring.

The company initially said it expected to employ about 5,200 people by the end of 2020, but a company sources told Reuters that the figure now looks likely to be closer to 1,000 workers.

It is unclear when the full 13,000 workers will be hired, the report noted.

Woo, in the interview, said about three-quarters of Foxconn’s eventual jobs will be in R&D and design - what he described as “knowledge” positions - rather than blue-collar manufacturing jobs.

Rather than manufacturing LCD panels in the US, it would be more profitable to make them in greater China and Japan, ship them to Mexico for final assembly, and import the finished product to the United States, Woo said.

That would represent a supply chain that fits with Foxconn’s current “fluid, good business model”, he said.

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