FOXCONN, WISCONSIN REACH NEW, SCALED-BACK DEAL
Original contract gets reworked as company’s plans keep changing
Foxconn Technology Group, the world’s largest electronics maker, has reached a new deal with reduced tax breaks for its scaled-back manufacturing facility in southeast Wisconsin, Gov. Tony Evers and the company announced on Monday.
Details of the new deal were not immediately released. It was scheduled to be approved at a meeting today of the Wisconsin Economic Development Corp., the state’s top jobs agency, which previously negotiated the initial deal with Foxconn.
The new deal will reduce the potential tax breaks by billions of dollars and still have potential tax breaks worth more than $10 million for the company, a person with knowledge of the new contract who was not authorized to speak publicly about the deal said Monday.
The original contract with nearly $4 billion in state and local tax incentives was struck in 2017 by then-Gov. Scott Walker. It was based on Taiwan-based Foxconn’s
promise to build a massive $10 billion flat-screen panel manufacturing facility in Mount Pleasant, near the Illinois border, employing up to 13,000 people.
Then-President Donald Trump heralded the original deal as a sign of a revitalized American manufacturing economy, calling the envisioned plant “transformational” and the “eighth wonder of the world.”
He traveled to Wisconsin in 2018 for the groundbreaking ceremony.
But Foxconn, best known for making Apple iPhones, has continually scaled back its plans for the site and missed employment targets that would trigger state tax credits. The state told Foxconn
last year that it would not award it tax credits because the company had made substantial changes in its manufacturing plans and was out of compliance with the tax credit agreement. Foxconn employed 281 people in 2019 in Wisconsin, according to the state economic development agency.
Evers, a Democrat who ran as a critic of the project in 2018 and defeated Walker, a Republican, said in a statement that the new deal “works for everyone.”
“I’ve said all along that my goal as governor would be to find an agreement that works for Wisconsin taxpayers while providing the support Foxconn needs to be successful here in our state,” Evers said.
Jay Lee, Foxconn’s vice chairman, said Foxconn approved the new deal with a desire to lower taxpayer liability in exchange for the flexibility to pursue business opportunities that meet market demand.
He said Foxconn was grateful that a solution could be found.
After the original deal was signed, Foxconn said it was downsizing the factory to be built over 2,500 acres of land from what is known as a Generation 10.5 plant to a Generation 6 plant that makes smaller thin-film transistor liquid crystal display screens for cellphones and other devices, rather than the larger screens that were first proposed.
Foxconn has announced, and then quickly ended, other projects at the site including “a cutting-edge, cloud-based, robotic retail platform” for caffeine sales and ventilators to help the state respond to the COVID-19 pandemic.
Most recently, Foxconn’s chairman said last month that it was now considering making electric vehicles at the facility.
The company’s changing plans led Evers to call for its contract to be rewritten.