Foxconn bets big on US expansion, Trump and unfettered demand for hi-tech devices

Foxconn Technology Group founder and chairman Terry Gou Tai-ming could be making the biggest bet of his career as his company builds a highly advanced manufacturing base in the Midwestern United States to rival its operations in China, while dodging the slings and arrows of American politics.

Gou joined US President Donald Trump on Wednesday in Washington to unveil Foxconn’s US$10 billion investment in the state of Wisconsin, where a state-of-the-art liquid crystal display (LCD) panel manufacturing plant will be built over the next four years.

Taiwan-based Foxconn, known formally as Hon Hai Precision Industry, will receive a generous US$3 billion, 15-year incentive package of tax credits from Wisconsin in the first of a series of expansion initiatives it plans to pursue in the US.

But Paul Haswell, a partner at international law firm Pinsent Masons, told the South China Morning Post that "since the deal seems to depend so heavily upon tax breaks and initiatives to attract Foxconn to the US, there’s every risk that with a change of government those tax breaks could dematerialise”.

“It’s a gamble insofar as it will associate Foxconn with the Trump administration," Haswell said.

Such a perception did not seem to faze Gou, as he gave credit to Trump, Wisconsin Governor Scott Walker and the recently established Office of American Innovation, headed by senior adviser to the president Jared Kushner, for supporting his company’s project.