Author | Mao Ge
Source | Big Cat Finance
In 2018, Trump attended an important construction event in Wisconsin . He dug soil with a golden shovel, which was so golden:
The ceremony was very grand, no wonder, this is the largest manufacturing industry return during the period of the Party and government. The factory came was Foxconn , and it was dug from this China. Trump also blew this new factory to the sky, "This factory will be the eighth miracle in the world" and can revive the American manufacturing industry.
According to the plan, more than 12,000 square meters of factory building will be built here, claiming to be the world's first 10.5th generation LCD LCD panel production line, which can efficiently produce large panels of more than 60 inches in size.
This factory can bring many benefits, such as 13,000 jobs, which can directly lead voters in the Rust Belt to improve their lives and achieve a well-off life.
Five years have passed in a flash. How is Foxconn's factory in Wisconsin?
reality is cruel. On the 3,000 acres of land that have been under construction for four years, there are still only a few buildings. A huge substation has basically not been developed, and the newly built roads are also sparsely populated.
At the beginning, it was not just Trump who brags, but Foxconn's Terry Gou was also full of confidence. promised a $10 billion investment, saying that it would establish a "standard-of-story display manufacturing factory" in the heart of the United States. This factory would be an "extraordinary opportunity".
It’s a pity that both of them have not reached their promise, why did this turn out?
Guo Taiming founded Foxconn in 1974. In 1988, Foxconn bought 500 acres of land in Shenzhen and officially entered the Chinese market. In the first year, relying on 128 employees, we brought an annual income of 1 million yuan, and the 1 million yuan in the late 1980s was a huge sum of money.
Guo Taiming must have a good vision, the industry is selected accurately, and the positioning is also clear. In addition to the cheap demographic dividend and the open policy of mainland China, Foxconn has opened cheats all the way and built multiple industrial parks in cities such as Beijing, Tianjin, Shanghai, and Zhengzhou. Everywhere you go, there are all kinds of green lights to open the way, and places treat Foxconn as a great god.
In 2005, Terry Gou became the richest man in Taiwan with a wealth of US$3.2 billion.
After Apple came, and Foxconn became the biggest beneficiary in the industrial chain. By 2019, Foxconn Group's total revenue reached US$178.6 billion, 20 times that of Luxshare Precision at that time.
But there is a problem with the large customers being too concentrated. is a strong dependency. Whatever Apple calls him to do, he will do whatever he wants. Taiwanese businessmen have always been nomads in the business world. It is unrealistic to rely solely on Taiwan to become bigger and stronger. Therefore, the mainland has good policies and comes to the mainland and says it the same as his own father. But his big client is an American company, and it is difficult not to avoid the influence of the competition between great powers. In April 2017, Trump had just been in office for three months, and called Terry Gou to White House , allowing him to open a factory in the United States. Governors from 6 states surrounded Terry Gou and offered him conditions, giving him subsidies and tax cuts.
Guo Taiming didn't hesitate either, after all, interests come first. The highest condition for
is Wisconsin:
gave Foxconn a fiscal subsidy of up to $3 billion for 15 years, including $1.5 billion in employment income tax reduction, $1.35 billion in investment income tax reduction, $1.5 billion in investment income tax reduction, $1.35 billion in USD in purchasing building materials, and $150 million in business tax reduction.
This is still obvious. Later, a media investigation found that Wisconsin's subsidy for Foxconn's factory construction project and infrastructure expenditure subsidy plan for has reached 4.5 billion US dollars.
This discount is too powerful. Among other states, the most discounted one is , Michigan , which promised 2.3 billion.
Guo Taiming naturally smiled and held the hand of Wisconsin Governor Walker, We are a win-win situation, let's do it.
But, the return of manufacturing in the United States has been shouting for many years. After the 2008 financial crisis, Obama proposed " re-industrialization ". Trump's policy is nothing new, but neither of them has made any substantial progress.
After all, it is difficult to industrialize after is deindustrialized. When you have nothing to do, you print money. Everyone likes financial assets. Capitalists are not interested in rebuilding industrialization. 's profit is not high. Obama himself recognized
, and filmed " documentary " for Cao Dewang's American factory to reflect on it.
Guo Taiming dug the soil with a golden shovel and found out when he officially started building the factory that there are many problems, and each one is more difficult to solve.
1. The promised discounts are no longer counted.
The guy who shook hands with Terry Gou at that time was Walker. As a result, in the subsequent governor election, his opponent Evers seized the project and made a statement. His point was that such a high subsidy as
is a waste of taxpayers' money and will affect the welfare of residents in the state.
When ordinary people hear it, they are so right. Why do we give our money to others with just a politician? Then Evers came on stage.
But this project is too big after all, and it is impossible to ignore it. Evers said, if you want to start, let’s discuss the conditions again, and the benefits mentioned above have changed their minds.
Governors' rebelliousness is not something? It can't be said that, just compare Fuyao Glass . The reason why Cao Dewang was able to settle in Ohio was first because he had a general large order and then moved the factory there, which could bring real employment to the local area. . Foxconn went to the United States to build a factory to create momentum for Trump. To put it bluntly, it was because he was interested in the discounts he gave and wanted to suck the blood of Americans in vain. , but after bragging, Trump left. The rest really depends on his real money to invest. Can Terry Gou not settle the score?
2. Land acquisition is difficult.
In fact, from the end of the groundbreaking ceremony, residents around the project started to make trouble, saying that the state government sold the land to a foreign company at a low price, and did not discuss it with the locals when signing the agreement.
American land is privately owned, and in the end Foxconn had to admit his money and gave him a compensation of $8,300 per mu of land. What is this concept? is about 7-10 times the market price. Local newspapers have said that this price is "unexpected in dreams."
But at this price, there are 12 residents in a small town who thought it was too low and sued the government.
3. Economic returns were sprayed.
That's not the end. A professor at the University of Georgia also came out to criticize and said that he had done the calculations and the state government subsidized 100,000 yuan for each job at Foxconn. The return period was not 20 years, nor 42 years, but hundreds of years or even forever. It means that the transaction of has suffered a huge loss.
4. Environmental protection.
American environmental protection organizations have also come to make trouble, saying that the Foxconn factory needs to use raw materials such as benzene, chromium, cadmium, mercury, zinc and copper. This is a toxic gas and a bunch of heavy metals, which will destroy the ecology of the United States... · · · · · · · · · 2 After all this, Guo Taiming was stunned. American sweatshops are really difficult to build. But I took the money and lost it. I had to find a way to do it with a tough bullet. When started construction, Foxconn changed its original plan, canceled the plan to produce the 10.5th generation panels, and decided to renovate the sixth generation panel factory, but not long after, the change plan was also stranded.In the following years, there were constant rumors that the factory would be transformed into high-end products for new technologies such as ventilators, Google servers, coffee robot electric vehicles, and "AI 8K+5G ecosystem". But rumors came one after another, and nothing ended up. According to US media reports, this place actually became a warehouse in Foxconn. In 2021, Foxconn and the Wisconsin government updated the agreement. The initial plan was abandoned, such as 130 million jobs and 10 billion US dollars of investment, so it will be zero. Finally, Foxconn promised to hire 1,454 employees and invest $672 million. As for Wisconsin's tax subsidy, it was also cut from $2.85 billion to $80 million. is just that, and the local government is particularly dissatisfied with it. " Wall Street Journal " said that because the plan for Foxconn's factory was ruined, the local government is burdened with the $300 million infrastructure debt that Foxconn promised to repay. So, starting next year, Foxconn will pay a special tax area in the local town a year of $36 million, which will last for more than 20 years until the infrastructure debt is paid off. In 2019, when the United States attracted global technology companies to suppress Huawei , Foxconn quickly drew a clear line with Huawei and closed many mainland factories. waved his hand and went to Southeast Asia to build a factory with 6 billion yuan, and also said, "Foxconn will give the mainland food to eat." turned around and he was disappointed in the United States. Later, he encountered epidemics, food poisoning, strike protests in factories in Southeast Asia. One by one, one incident after another, and production was suspended many times, but it never stopped. In desperation, Terry Gou built a factory in India again. Not long after the start of construction, he encountered a large-scale epidemic in India. Even after the epidemic was over, Indian workers still came to strike, and importing raw materials was not convenient. In short, it was all kinds of discomfort. After this wave, everyone has seen each other clearly. The sales of mobile phones are declining to the naked eye. Foxconn wants to do the electric vehicle OEM business. Will the mainland still give him a chance in this wave?
