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Dive brief:
- Electronic component maker Foxconn is investing An additional $569 million to expand operations in Mount Pleasant, Wis., the company announced Wednesday.
- The investment will create 1,374 jobs over the next four years and help Foxconn build its artificial intelligence infrastructure, according to the press release. Foxconn, known as Hon Hai Technology Group in Taiwan, is one major supplier of Apple components.
- The money will also help Foxconn address growing demand for data servers from its US customers, as well as strengthen the company’s supply chain to support innovations in data management and new technology capabilities.
Diving knowledge:
Foxconn modified its contract with Wisconsin Economic Development Corp. for the second time, with the amended agreement providing up to $16 million in additional performance-based tax incentives, according to the press release from the regional agency.
Under the amended contract, Foxconn pledged to create 2,616 jobs and make a total of $1.2 billion in capital investments through December 31, 2029.
The The Taiwan-based company initially announced in 2017 this was establishing a manufacturing facility and pledged to invest $10 billion and create 13,000 jobs.
The installation open May 2021but had remained inactive since then, they said media reports. A month before the opening of the factory, Foxconn he renegotiated his agreement with the state up to an investment of 672 million dollars and only 1,454 jobs.
Then, in the summer of 2023, Microsoft paid Foxconn $50 million and bought land in Racine County, Wis., to build a billion-dollar-plus data center, which he has since overcome $7 billion to build a second data center.
On December 31, 2024, Foxconn invested nearly $717 million in its Mount Pleasant campus and created 1,242 jobs, qualifying the company for $62.9 million in state tax credits, according to the Wisconsin Economic Development Corp.
The company expects to see “strong visibility” for AI data server demand over the next two years and plans to expand facilities in Mount Pleasant and Texas. Kathy Yang, rotating CEO of Hon Hai Technology Group, said during the announcement of the company’s second quarter results in August.
“We continue to expand in these locations, including adding AI server liquid cooling test capability,” Yang said. “Additionally, in California and at our campus in Ohio, we will add capacity for cloud and networking products. Through these efforts, we aim to fully meet the growing demand of our customers.”
The latest investment comes about a week after Apple’s component supplier announced a collaboration with OpenAI.
The two companies will focus on design work and US manufacturing readiness for the new AI infrastructure hardware. according to the November 20 press release.
The agreement involves OpenAI sharing information about new and developing hardware needs in the AI industry. Foxconn will use this information to help design and develop hardware that will be manufactured at the company’s facilities in the United States.
In addition, the collaboration will help strengthen domestic supply chains in the United States and expedite the distribution of new AI systems. Foxconn will manufacture AI data center components, including cabling, networking, cooling and power systems.
While the agreement does not include purchase commitments or financial obligations, OpenAI will have early access to evaluate the AI systems with an option to purchase the products, according to the company’s press release.
“As the demand for more data infrastructure continues to grow, Foxconn will continue to respond to our customers’ needs with flexibility and scale in the United States,” Jerry Hsiao, Foxconn’s chief product officer and CEO of Hon Hai USA, said in a statement Wednesday.
