Foxconn and Apple to invest in a $7 billion display plant in the U.S.
AP Photo/Luca Bruno
Main page News, Donald Trump

Apple's main manufacturing partner Foxconn considers a joint investment with the American tech giant into a U.S.-based production plant that would create up to 50,000 new jobs.

Yet another report from Nikkei Asian Review revealed earlier today that Apple (NASDAQ: Apple [AAPL]) had plans for a joint investment together with its Asian partner Foxconn (TT: 2354) into a $7 billion display production facility in the United States. According to Foxconn Chairman Terry Gou, the companies plan to produce TV and smartphone displays to be used in Apple's products because the U.S. has no production of TV displays, despite being one of the largest TV markets in the world. For Apple, this could also be a way to reach a compromise with the newly-elected President Trump.

"Apple is willing to invest in the facility together because they need the [panels] as well," Gou told Nikkei Asian Review.

The Chairman said that the $7 billion plant could create about 30,000 to 50,000 new jobs in the region as well as boost Apple's domestic production, as reported by Bloomberg. Interestingly, a few months ago, Gou claimed that his company was planning to open a new $8.8 billion factory in China, although he said in an interview in November that Foxconn was eyeing the U.S. market for its next production plant. Even though Gou said that this decision simply responds to the growing demand for display panels in the U.S, some experts said that Foxconn came up with the idea of opening a multibillion factory in the U.S. only a day after Softbank's CEO Masayoshi Son met with Donald Trump and agreed to invest $50 billion in the U.S. as well as to create tens of thousands of jobs. Could this be a coincidence?

Nikkei mentioned that back in November, Apple asked Foxconn to consider a possibility of producing iPhones in the U.S. while in an interview with Axios last week, Trump made it clear that he was waiting for Apple to take steps to bring the production back to the United States. He noted that Apple CEO Tim Cook was more open towards this idea and Trump believed that Cook loved the country and would "like to do something major here.”

“I said, ‘Tim, you know one of the things that will be a real achievement for me is when I get Apple to build a big plant in the United States, or many big plants in the United States, where instead of going to China, and going to Vietnam, and going to the places that you go to, you’re making your product right here,’” Trump said in an interview with the New York Times.

The Verge said that Trump repeatedly mentioned Apple as one of the American companies he wanted to produce products "stateside", although his stance was criticized by the industry experts claiming it would affect the prices.

During the inauguration speech last week, Trump repeated his view on domestic production:

"We will build new roads and highways and bridges and airports and tunnels and railways all across our wonderful nation. We will get our people off of welfare and back to work, rebuilding our country with American hands and American labor. We will follow two simple rules; buy American and hire American," Donald Trump said, according to TIME's transcript.

Bloomberg added that Foxconn's decision to open a multi-billion factory in the U.S. instead of China was likely to unnerve the Chinese government, since the Taiwanese company employs more than a million people in the country. Both Foxconn and Apple have been long relying on Chinese factories to produce their flagship products at lower costs and Foxconn's Chairman Gou emphasized that neither of the companies planned to leave the country.

"Yes, we will continue to add to our investments in China. China is the world's biggest market, and why should we turn down the biggest market?" he told reporters.

The sources noted that this was still a preliminary announcement. Apple has not provided any comments on Nikkei's report so far.

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