Foxconn drastically scales back plans for $10 billion Wisconsin factory

After promising 13,000 new jobs in the state, Foxconn will only create 1,454 positions.

Brian Snyder / Reuters

Foxconn is drastically downsizing its controversial factory in Wisconsin after initially promising to invest $10 billion. The company will instead put $672 million into the project under its new deal with the state. At first, Foxconn said the facility would lead to 13,000 new jobs. Instead, it will only create 1,454 positions, Reuters reports.

According to Foxconn, the reduced scale of the project affords the company the “flexibility to pursue business opportunities in response to changing global market conditions.” It claimed that the "original projections used during negotiations in 2017 have at this time changed due to unanticipated market fluctuations.”

When the company and state officials announced the project, Foxconn pledged to build a manufacturing facility at the campus, which spans 20 million square feet. It said it would make advanced flat-panel displays.

However, Foxconn's aims for the campus have long been in flux. It ditched plans to build state-of-the-art displays in favor of smaller, less-advanced ones — but that didn't come to pass either. In early 2019, Foxconn considered shifting the focus from manufacturing to research and development. After critics attacked that proposal, the company gave assurances that the campus would have manufacturing facilities as well as a research hub.

Foxconn chairman Liu Young-way said the company is making medical devices, servers and communications equipment in Wisconsin. He suggested it may build electric vehicles there too.

The latest deal between Foxconn and Wisconsin reduces the planned subsidies for the project, which ultimately could have cost taxpayers over $4 billion. Foxconn is now eligible for $80 million in tax credits, down from $2.85 billion. Governor Tony Evers said those credits are in line with those for which any company is eligible. They're performance-based and will depend on whether Foxconn hits capital investment and employment targets.

The state has already spent hundreds of millions of dollars on the project. According to Reuters, records showed that Wisconsin has shelled out north of $200 million on tax exemptions, road improvements and grants for training and employment. As of 2019, the village where Foxconn's campus is based had paid around $152 million to buy and demolish 132 properties through eminent domain, along with almost $8 million to cover relocation costs.