In Wisconsin, Trump’s Deal With Foxconn Is Perilously Close To Failing

CNBC's Scott Cohn reports from the site of where Foxconn is supposed to build a new plant in Wisconsin. The company has missed hiring targets, construction dates and more.Screengrab / CNBC / Youtube

A $10 billion project has seen only $99 million in actual investment, according to the latest state filings.

West of Lake Michigan, contractors cleared hundreds of acres worth of farmland and homes for Foxconn Technology Group’s plan to build a “$10 billion liquid-crystal-display factory,” The Wall Street Journal reports. Local taxpayers have borrowed nearly $350 million to improve local infrastructure for the project, and construction workers are stretching Interstate 94 in anticipation for the thousands of workers and driverless trucks supposedly headed for the factory.

But there’s one problem: Foxconn is nowhere to be seen.

President Donald Trump and the Taiwanese manufacturing company’s chairman, Terry Gou, planned the factory in 2017. Last year, both men traveled to Mount Pleasant, about 20 miles from Milwaukee, for the gold-shovel groundbreaking.

However, the latest state filings revealed that, as of December 31, the technology company famous for being an Apple Inc. supplier had only put in $99 million so far—less than one percent of its promised investment. Foxconn boasted that it would employee over 2,000 in-state employees by the end of this year, but had fewer than 200 going in to 2019.

Local officials are still waiting to receive building plans for the factory, but Foxconn contractors, they say, are rarely on the site as of late. But the costs of the factory’s delay are more than apparent already: Mount Pleasant’s debt rating has slipped, and residents decry land seizures.

“At some point we’re talking about things that are just imaginary,” said Racine County, where the site is located, commissioner Nick Demske. “We’re pretending.”

County executive Jonathan Delagrave, however, stressed that large projects inevitably come with delays. “I think it’s fair for people to question it, absolutely. But I also think that it’s fair to say a lot of good things are happening,” he said.

In a statement, Foxconn said that the company “stands by the job creation commitments that we have made, and we look forward to completing” the site. “After the winter break, which has an impact on construction projects of this scale, we are now looking forward to beginning the next phases of construction...by Summer 2019 with production expected to commence during the fourth quarter of 2020.”

The company says that it completed contracts in recent months worth nearly $34 million for utility and roadway construction work. “We believe in Wisconsin, its people, and its potential to become a high technology hub.”

The U.S. government’s deal with Foxconn is one of the largest U.S. public-incentive projects ever given to a foreign entity, comprising of over $4 billion in state and local investments and tax breaks.

Read the full story here.

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