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Chinese Firm Shifts US Investment Away From Manufacturing


FILE - President Donald Trump takes a tour of Foxconn with Foxconn chairman Terry Gou, right, and CEO of SoftBank, Masayoshi Son, June 28, 2018, in Mt. Pleasant, Wisconsin.

China's largest employer said Wednesday it is shifting away from construction of a mammoth electronics factory in the U.S., a facility that President Donald Trump once heralded as the rebirth of manufacturing in the country's heartland.

Foxconn Technology Group said the global market environment has forced it to turn the project in the Midwestern state of Wisconsin into a research hub, but that it still plans to create 13,000 jobs as it had promised at the factory.

Foxconn, when it announced the manufacturing plant in 2017, promised to invest $10 billion, but the company did not recommit to the same figure for the research facility.

A shovel and FoxConn logo are seen before the arrival of U.S. President Donald Trump as he participates in the Foxconn Technology Group groundbreaking ceremony in Mount Pleasant, Wisconsin, June 28, 2018.
A shovel and FoxConn logo are seen before the arrival of U.S. President Donald Trump as he participates in the Foxconn Technology Group groundbreaking ceremony in Mount Pleasant, Wisconsin, June 28, 2018.

Foxconn is a major supplier to the giant U.S. technology firm Apple and is the world's largest contract maker of electronics. A company official said it is scaling back, though, and possibly ending plans to build liquid crystal display panel screens, saying it cannot compete in the U.S.

Wisconsin state and local governments promised about $4 billion in incentives to Foxconn to locate in the state. Former Gov. Scott Walker widely promoted the project and Trump visited the would-be manufacturing site.

They described it as a once-in-a-generation opportunity to create more manufacturing jobs for blue collar workers in the Midwest, where numerous factories have been shuttered as companies looked for cheaper labor in other countries.

"America is open for business more than it has ever been open for business," Trump said at the Foxconn groundbreaking event last June. "Made in the USA: It's all happening and it's happening very, very quickly."

FILE - Wisconsin Democratic candidate for governor Tony Evers speaks at a rally in Milwaukee, Oct. 26, 2018. Evers won and is Wisconsin's governor.
FILE - Wisconsin Democratic candidate for governor Tony Evers speaks at a rally in Milwaukee, Oct. 26, 2018. Evers won and is Wisconsin's governor.

But Walker, a Republican, was defeated for re-election in November by the new governor, Democrat Tony Evers, who had questioned the size of the incentives handed to Foxconn, although he did not pledge to undo the deal.

Evers has not commented on the company's change in plans, but one Democrat state lawmaker said, "Every step of the way Foxconn has overpromised and underdelivered."

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