Michi­gan called hot Fox­conn prospect

Northwest Arkansas Democrat-Gazette - - BUSINESS & FARM - DAVID EGGERT

LANSING, Mich. — Gov. Rick Sny­der ex­pressed op­ti­mism that Tai­wanese elec­tron­ics man­u­fac­turer Fox­conn Tech­nol­ogy Group will open a fa­cil­ity in Michi­gan, but he said the specifics re­main un­cer­tain and it could be a few months be­fore any po­ten­tial deal takes shape.

In a phone in­ter­view Mon­day night from Shang­hai, where he was con­clud­ing a nine-day trade trip in China, Sny­der said there is a “strong pos­si­bil­ity” for Fox­conn to still lo­cate in the state af­ter the com­pany in re­cent weeks picked neigh­bor­ing Wis­con­sin for a $10 bil­lion dis­play panel plant with 3,000 em­ploy­ees that could grow to 13,000.

Sny­der told The Associated Press that Fox­conn Chair­man Terry Gou in­vited him for din­ner, meet­ings and a tour of the com­pany’s sprawl­ing fac­tory in Shen­zhen near Hong Kong that em­ploys some 200,000 work­ers. They dis­cussed the au­ton­o­mous-ve­hi­cle in­dus­try and ad­vanced man­u­fac­tur­ing, Sny­der said.

The com­pany, he said, is highly ad­vanced in tool­ing, ma­chin­ery and robot-

ics sim­i­larly to Michi­gan but does not yet have much of a U.S. pres­ence in those sec­tors.

“We had very healthy, very good dis­cus­sions about Michi­gan’s strengths and how it could be very good for Fox­conn to be present in Michi­gan in some fash­ion. What it is has yet to be de­ter­mined,” he said.

Chi­nese me­dia out­lets, quot­ing Gou, re­ported over the week­end that Fox­conn plans to open a re­search and de­vel­op­ment cen­ter re­lated to self-driv­ing ve­hi­cles in Michi­gan, where Gen­eral Mo­tors, Ford and Fiat Chrysler are based. The com­pany has not con­firmed the plans, in­stead re­peat­ing that Michi­gan is one of the states un­der con­sid­er­a­tion for some sort of in­vest­ment.

Sny­der de­clined to con­firm Fox­conn is eye­ing an au­ton­o­mous-ve­hi­cle fa­cil­ity but said “that would be one of the nat­u­ral things that they could well be look­ing at.” Fox­conn said last month that its Wis­con­sin an­nounce­ment was just the first of sev­eral un­spec­i­fied in­vest­ments the com­pany will be mak­ing in the U.S.

“It’s go­ing re­ally well,” Sny­der said of the courtship. “But we’re still get­ting to know each other, we’re still work­ing through that. They

can make their own busi­ness de­ci­sions. But we’re go­ing to con­tinue to present them good op­por­tu­ni­ties of what we can do in Michi­gan.”

Lit­tle known to con­sumers, the maker of iPhones and other gad­gets is a gi­ant in the elec­tron­ics in­dus­try thanks to its dom­i­nant po­si­tion in the global man­u­fac­tur­ing sup­ply chain. Work­ing con­di­tions at Fox­conn’s fac­to­ries in China have come un­der scru­tiny in the past be­cause of la­bor prac­tices and sui­cides.

Michi­gan was one of seven states that com­peted for the Fox­conn plant that went to Wis­con­sin. Sev­eral of the states were im­por­tant in Don­ald Trump’s pres­i­den­tial vic­tory. Trump made the

Fox­conn an­nounce­ment in a White House cer­e­mony at­tended by Gou. Other states that vied for the plant were In­di­ana, Ohio, Penn­syl­va­nia, Texas and Illi­nois.

Crit­ics have cau­tioned that Fox­conn has made prom­ises be­fore to in­vest in the U.S. and else­where around the world and not fol­lowed through. Fox­conn promised in 2013, for ex­am­ple, to in­vest $30 mil­lion and hire 500 work­ers for a new, high-tech fac­tory in Penn­syl­va­nia that was never built.

Fox­conn also has strug­gled to meet high safety and other stan­dards ex­pected of con­sumer elec­tron­ics brands while keep­ing costs low. Its Chi­nese plants mak­ing

Ap­ple prod­ucts have drawn at­ten­tion for worker sui­cides, ac­ci­dents and la­bor dis­tur­bances. La­bor ad­vo­cates say the com­pany im­poses ex­ces­sive over­time and pres­sure on work­ers, es­pe­cially when it ramps up pro­duc­tion ahead of new iPhone re­leases. Gou has raised wages and pledged to pre­vent more deaths.

Sny­der and Michi­gan law­mak­ers last month en­acted job-cre­ation tax in­cen­tives, in­clud­ing one tai­lored to com­pa­nies such as Fox­conn that add at least 3,000 jobs that pay the av­er­age re­gional wage. But Wis­con­sin of­fered what Sny­der called a “gi­gan­tic” $ 3 bil­lion in­cen­tive pack­age to land the fac­tory that will con­struct liq­uid crys­tal dis­play (LCD) mon­i­tors used in tele­vi­sions and com­put­ers.

Sny­der said Fox­conn has other projects on its radar that “would be bet­ter suited for Michi­gan.” He said it is too early to say how many jobs could come with a Fox­conn fa­cil­ity in Michi­gan. He is hope­ful that talks con­tinue in the next few months and “things start so­lid­i­fy­ing.”

The trip was the Sny­der ad­min­is­tra­tion’s sev­enth mis­sion to China. Sny­der said one theme through­out the trip was China’s in­creased in­ter­est in au­ton­o­mous mo­bil­ity and that he wants Michi­gan to cap­i­tal­ize on po­ten­tial busi­ness op­por­tu­ni­ties in the emerg­ing sec­tor.

AP/ALEX BRAN­DON

Terry Gou, pres­i­dent and chief ex­ec­u­tive of­fi­cer of Fox­conn, ac­com­pa­nied by Vice Pres­i­dent Mike Pence (left) and House Speaker Paul Ryan, R-Wis­con­sin, speaks in the East Room of the White House on July 26.

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