The iPhone maker got fat incentives to build a $10 billion LCD plant that largely hasn’t materialized on land where Mount Pleasant, Wis., razed homes and crops
MOUNT PLEASANT, Wis.—Six miles west of Lake Michigan lies a cleared building site half again as big as Central Park, ready for Foxconn Technology Group’s $10 billion liquid-crystal-display factory.
Contractors have bulldozed about 75 homes in Mount Pleasant and cleared hundreds of farmland acres. Crews are widening Interstate 94 from Milwaukee to the Illinois state line to accommodate driverless trucks and thousands of employees. Village and county taxpayers have borrowed around $350 million so far to buy land and make infrastructure improvements, from burying sewer pipes to laying storm drains.
One thing largely missing: Foxconn.
President Trump and Foxconn Chairman Terry Gou hatched the factory plan in 2017, and both attended last summer’s gold-shovel groundbreaking in Mount Pleasant, 20 miles south of Milwaukee.
As of Dec. 31, the Taiwanese manufacturing giant, famous as an AppleInc. supplier, had spent only $99 million, 1% of its pledged investment, according to its latest state filings. The company projected as many as 2,080 in-state employees by the end of 2019 but had fewer than 200 at last year’s end, state filings show. The village is still awaiting factory building plans for review. Locals said Foxconn contractors have recently been scarce on the site.
The impact on Mount Pleasant, by contrast, is palpable. Its debt rating has slipped. Local politics has become fraught. Neighbors have fallen out over land seizures.
“At some point we’re talking about things that are just imaginary,” said Nick Demske, a commissioner in Racine County, where the plant is. “We’re pretending.”
.. The Foxconn project is among the biggest U.S. public-incentive deals ever offered to a foreign company, a more than $4 billion package of state and local tax breaks and investments. A Foxconn video last year showed renderings of a futuristic campus resembling Apple’s spaceshiplike Silicon Valley headquarters, with light rail shuttling workers. Foxconn said the video was for illustration purposes.
.. Foxconn, known formally as Hon Hai Precision Industry Co., is the main assembler of Apple’s iPhone and a major employer in China. It reported annual revenue of $5.29 trillion New Taiwan dollars (US$171 billion today) in 2018 and said profits have been under pressure from lower iPhone sales in China.
Foxconn had planned to make large state-of-the-art screens in Mount Pleasant but said last summer it would make small screens of an older technology instead, citing the distance from the Asia supply chain after Corning Inc. said it wouldn’t build a glass facility next door.
In January, Foxconn said it was backing out of the plan to build an LCD factory in the village, citing high U.S. labor and material costs. Days later, after a phone call between Mr. Trump and Mr. Gou, Foxconn reversed course and said it would go ahead with the facility making small screens, adding some other functions.
#132 Negative Mount Pleasant
A small town in Wisconsin becomes the site of a completely unprecedented experiment.
A Better Mount Pleasant vs Let’s Make A Better Mount Pleasant
Journalist Larry Tabak’s series on Foxconn in Wisconsin
Economist David Merriman’s paper on the type of financing used by Mount Pleasant
Journalist Brian Merchant’s book which includes a visit to Foxconn campus in ChinaAn Interview with Sruthi Pinnamaneni on Vergecast
Transcript
[THEME MUSIC]PJ VOGT: From Gimlet, this is Reply All. I’m PJ Vogt.So there’s this tiny town in Wisconsin called Mount Pleasant. Population’s just 26,000 people, technically it’s a village. And life in Mount Pleasant is usually as quiet as you’d expect. They’re a suburb of Racine, home of malted milk and the site of some of America’s largest cabbage farms. But that’s the city. Mount Pleasant’s the suburb–place where nothing really happens. Until last year, when the village became the site of a completely unprecedented, massive international experiment.
Foxconn Deal… Or No Deal?
Early in his presidency, Donald Trump said the Foxconn plant in Wisconsin would be “the eighth wonder of the world” because it would spectacularly revitalize American manufacturing. After billions of dollars in tax incentives, the Taiwanese tech company now seems to be reneging on some of what it promised. Sruthi Pinnamaneni is a reporter at the Reply All podcast who made an episode about the deal called ‘Negative Mount Pleasant’. She talks about how the residents of the Wisconsin village of Mount Pleasant see the deal, and what they’ve been through in the spotlight.