To Beat Samsung Electronics?
Taiwan's Hon Hai Group (Foxconn) will invest 11 trillion won (US$10 billion) to build an LCD (liquid crystal display) production plant in Wisconsin, the US. An LCD is mainly used as a screen of a TV or smartphone. Hon Hai is planning to make a full-scale foray into the North American TV market dominated by Samsung Electronics and LG Electronics by means of massive investment in the US.
"We will build an LCD factory in the southeastern region of Wisconsin by investing 10 billion dollars,” said Terry Gou, chairman of the Hon Hai Group, in a meeting with US President Donald Trump at the White House on July 26 (local time)." According to Gou’s plan, the Wisconsin plant will employ up to 13,000 people and produce ultra-high-definition LCD panels for TVs and computers.
The announcement of big investment in the US by Hon Hai will mount a pressure on Korean companies such as Samsung Electronics and LG Electronics. Chairman Guo is always bent on outclassing Samsung. In May of last year, "I will definitely beat Samsung Electronics" said Gou in front of minority shareholders. Actually, Hon Hai halted supplying LCD TVs to Samsung and LG after taking over Sharp in Japan last year, and has been keeping Korean companies in check. There are also prospects that the iPhone will be assembled and produced in the US after TVs. The Nihon Keizai Shimbun newspaper said that the Hon Hai Group secured the ability to respond to North American market demand more flexibly than its competitors by establishing local production facilities.
The US State of Wisconsin where the Hon Hai plant will be built is a stronghold of the Republican Party and part of the "Rust Belt" (a declining old industrial zone in the US) with many strong supporters of President Trump. Trump welcomed the investment plan, saying, "I will never let American workers down." Wisconsin said it will offer $3 billion in incentives, including tax benefits, to Hon Hai for building the Foxconn plant.