Taiwan’s Foxconn (opens in new tab) Group has signed a contract to make key Google server components at its Wisconsin plant, rather than in China, according to Bloomberg (opens in new tab). The decision could help create a host of manufacturing jobs at the factory, which has been severely underutilized for years.
Reports indicate that the Foxconn factory will begin production on the Google components in the first quarter of next year. The decision to center production in the US could also lead to the signing of further contracts in the country, with Foxconn keen to lessen its reliance on its Chinese production base.
Google may have also had future government contracts in mind when it awarded the server manufacturing deal to Foxconn. The Wisconsin factory that will make the parts carries huge political weight, potentially bringing 13,000 manufacturing jobs to the state.
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Construction at the Wisconsin site began in 2018, with local and state governments spending millions to create the infrastructure that Foxconn needed. Despite that, the plant has remained largely empty, with Foxconn accused of greatly overpromising the site’s potential. The factory was used to make face masks and ventilators in the fight against the coronavirus pandemic this year, but its manufacturing capabilities remain largely underutilized.
The Google deal offers the plant a lifeline, however, with the search engine giant partly choosing the factory for technological reasons: Foxconn was the only company with a US base that said it was capable of delivering the surface-mount technology assembly lines needed to produce the server parts.
Foxconn, which is largely known for making the majority of Apple’s iPhone products, may see the Google contract as an opportunity to diversify its revenue streams. The deal will also raise eyebrows regarding future US-China relations as US President Donald Trump, who has pursued hostile policies against Beijing, prepares to step down.
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Via Bloomberg (opens in new tab)