MADISON, Wis. —
Wisconsin Gov. Tony Evers' administration and Foxconn Technology
Group said Thursday that a massive project planned for the state was
moving forward, and disputed Republicans who blamed the new
Democratic governor for a change in direction away from
manufacturing to more research jobs.
Foxconn said Wednesday that it was shifting the focus of the
Wisconsin project away from making high-tech flat panel screens for
televisions and other products in favor of a research and
development hub. While the company insisted it would still employ up
to 13,000 people, they would primarily be scientists and developers,
not blue collar assembly line workers as originally promised.
President Donald Trump, who heralded the Foxconn project as the
"eighth wonder of the world" at its groundbreaking last summer, had
pointed to it as a sign of a manufacturing resurgence in America.
In response to Foxconn's change in direction, the White House on
Wednesday referenced to Trump's work to improve the U.S. business
climate. An administration official, who asked not to be identified
to discuss internal thinking, said the White House would be
"disappointed" if the promised initial investment did not pan out.
Foxconn, the world's largest electronics manufacturer, has not said
this week whether it will invest the $10 billion in Wisconsin as
originally promised. Local Wisconsin government and economic
development officials said they were assured by Foxconn that
remained the goal.
Over the past year, Foxconn has repeatedly revised what it plans to
do in Wisconsin and the type of workers who will do it. Foxconn
cited a changing global market as requiring a move away from making
LCD panels in Wisconsin. Apple is Foxconn's main manufacturing
customer and it has forecast a drop in revenue from the Chinese
market due to decreasing demand for iPhones.
Foxconn's shift away from manufacturing LCD panels led Republican
legislative leaders to lay blame on Evers, who had been critical of
the project and its potential $4 billion in taxpayer subsidies
during his campaign with then-Gov. Scott Walker. Evers has also
proposed capping a manufacturing tax credit program that is not a
part of the contract with Foxconn.
Still, Republicans said Evers' desire to all-but eliminate that
credit was part of an "anti-jobs agenda." Foxconn's move away from
manufacturing shows it is "reacting to the wave of economic
uncertainty that the new governor has brought with his
administration," Assembly Speaker Robin Vos and Senate Majority
Leader Scott Fitzgerald said.
But both Foxconn and Mark Hogan, head of the state's economic
development agency under Walker and Evers, disputed the GOP claims
on Thursday. Hogan, CEO of the Wisconsin Economic Development
Corporation, also disputed a report from Nikkei Asian Review, citing
anonymous sources, that said Evers was attempting to renegotiate
side deals with the company.
"I have been involved with the Foxconn project from day one and
there never have been any side deals and the contract stands on its
own," Hogan said in a statement. "In addition, there have been no
attempts by either the company or the Evers' or Walker
administrations to renegotiate WEDC's contract."
Evers' spokeswoman Melissa Baldauff tweeted that the report claiming
Evers was trying to renegotiate the contract was "false."
Hogan said Evers and his administration "have done a very good job
of reaching out to company officials and developing a relationship
that will protect our taxpayers' interests and at the same time,
give Foxconn the ability to be successful in Wisconsin."
Foxconn issued its own statement Thursday, saying "All interactions
to date with Governor Evers and his team have been constructive and
we look forward to further discussions" about continuing the
Foxconn repeated its assurances from Wednesday that the project is
moving forward and it plans to employ up to 13,000 people. It said
over the next 18 months Foxconn plans to build a packaging plant, a
molding factory, an assembly facility, a prototyping center, a
research and development center a high-performance data center and a
"town center" to support people working on the sprawling campus near
Vos and Fitzgerald did not immediately return messages seeking
comment in reaction to the Foxconn and Hogan statements.
The Foxconn deal was negotiated by Hogan for Walker, who along with
Trump touted it as a "once-in-a-generation" opportunity to bolster
manufacturing in the United States.
The credit rating agency Moody's Investors Service cautioned
Thursday that Foxconn's failure to hire enough people last year to
capture state tax credits highlights the financial risks facing
local communities that are spending money on the project.
Foxconn filled 178 Wisconsin jobs in 2018, 82 short of the target
needed to claim $9.5 million in tax credits. However, the company
could claim them by exceeding job totals in future years.