Phil Hauck's TEC Blog

Wednesday, July 24, 2019

On FoxConn

I belong to the Independent Business Assn. of Wisconsin, a Milwaukee-based group, and at a recent monthly breakfast meeting they had as speakers on the current status of FoxConn two people from Mt. Pleasant, the municipality in which it exists.  One was the economic development manager, and the other was their hired, very experienced project manager for the FoxConn project.
I wanted insights into what is really happening there, and I think they provided it.
Keep in mind that FoxConn is already assembling TV screens there for a number of customers (not manufacturing them, assembling them).

       1.  Yes, they will no longer make the 65" TV screens there, but rather the ones up to 36”.  The market for the larger ones is slowing, and they already make them elsewhere.  (Note:  There currently are NO manufacturing facilities for TV screens left in the U.S.; this will be the only one here.)
       2.   Mt. Pleasant has purchased the 3,000+ acres that make up the FoxConn footprint … and FoxConn has first option on any purchases.
       3.  They are currently developing a southern 850-acre property, on which the million-square-foot slab has been poured.  They have one building up, primarily used right now to warehouse equipment and product.  They expect to have all their buildings up by late fall, and completed and ready for operation beginning in Fall 2020.
       4.  The project manager meets weekly with every major construction manager to review progress against the timetable.  It includes representatives of the interested state agencies:  DOT, DNR, etc.
       5.  The only water that will leave the property will be for storm and sewer drainage.  All of the water used in production processes, which will also include hazardous metals, will be processed in a self-contained facility.  Some of the materials will be re-used, others will be appropriately land-filled, and the water will be re-used.  The cost is $30 million for the facility, and about $7 million of annual operating expenses to do this.
       — All state and federal environmental regulations are being complied with.
       — Mitigation of wetlands was done at 2X the required amount.
       6.  He cited the incredibly impressive numbers regarding the amount of dirt moved, size of electric substations, and other infrastructure development.
       7.  State ubsidies will be provided only after the agreed numbers are in place.
       8.  While the cost of the subsidies is large, yielding a lengthy payback period, the amount of additional development in Racine County will be very impressive … currently estimated at $750 million.  Example:  Three hospitals are building along Hiway 20 near the project.  Property values are already increasing.
In other words, a lot more positives than we hear in the media.
One other thing:  Be aware that there is no longer a TV screen manufacturing plant in the U.S.  This will bring this type of manufacturing back here.  The rumor is that FoxConn has a huge contract with GM to manufacture at this facility the dashboard screens and panel screens for their cars.

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