Sunday, January 22, 2017
FOXCONN To INVEST Over $7 BILLION in U.S.
TAIPEI (Reuters) - Foxconn, the world's largest contract electronics maker, is considering setting up a display-making plant in the United States in an investment that would exceed $7 billion, company chairman and chief executive Terry Gou said on Sunday.
The plans come after U.S. President Donald Trump pledged to put "America First" in his inauguration speech on Friday, prompting Gou to warn about the rise of protectionism and a trend for politics to underpin economic development.
Foxconn's proposal to build a display plant, which would be planned with its Sharp Corp <6753 .t=""> unit, depend on many factors, such as investment conditions, that would have to be negotiated at the U.S. state and federal levels, Gou told reporters on the sidelines of a company event.6753>
Gou said that Foxconn, formally known as Hon Hai Precision Industry Co <2317 .tw="">, had been considering such a move for years but the issue came up when Foxconn business partner Masayoshi Son, head of Japan's SoftBank Group Corp <9984 .t="">, talked to Gou before a December meeting Son had with Trump.9984>2317>
As a result of the meeting, Son pledged a $50 billion of investment in the United States and inadvertently disclosed information showing Foxconn's logo and an unspecified additional $7 billion investment. At the time, Foxconn issued a brief statement saying it was in preliminary discussions to expand its U.S. operations, without elaborating.
"Son is a good friend," Gou said, adding that Son had asked for his views about investing in the United States.
Gou said he told Son that the United States has no panel-making industry but it is the second-largest market for televisions. An investment for a display plant would exceed $7 billion and could create about 30,000-50,000 jobs, Gou told Son.
"I thought it was a private conversation, but then the next morning it was exposed," Gou said. "There is such a plan, but it is not a promise. It is a wish."
Foxconn has existing cooperation and operations in Pennsylvania, which is a state Foxconn would prioritize, depending on land, water, power, infrastructure and other investment conditions, he said.
Gou added that Foxconn would also remain active in China, dispelling talk that Beijing may be pressuring Foxconn about its investments.
Taiwan's tech-dominated manufacturers have been nervous about potential U.S. trade policies because Trump has threatened to raise tariffs on imports from some countries, notably China.
Foxconn is one of the biggest employers in China, where it operates factories that churn out most of Apple Inc's