Foxconn Becoming The Next Motorola Development Failure

President Trump’s much touted $10 billion industrial development in Mount Pleasant, Wisconsin is rapidly deteriorating into the same sort of government promoted, ultimately failed industrial development as the Harvard, Illinois Motorola manufacturing campus, and Foxconn to date has invested less than 1% of the $10 billion promised in return for $4 billion in state and local government tax incentives. Meanwhile, state and local government units already have borrowed and invested $350 million to acquire real estate and pay for site work including sewers and storm drains on Foxconn’s proposed site, dwarfing the $99 million Foxconn itself has invested in the project to date.

Additionally, Foxconn’s plans, originally projected to produce 2,080 permanent manufacturing jobs by the end of this year, have created a mere 200 jobs to date, and the scope of the project has been materially reduced to making smaller television and telephone screens, due to Foxconn’s failure to get Corning, Inc. to invest in a glass manufacturing plant on adjacent acreage. Residents of Mount Pleasant and the surrounding Racine County area are urging their government officials to slow down expenditure of public funds committed to the project, based on Foxconn’s failure to meet promised investment and job creation goals, and the company’s dramatic reductions in the proposed scope of both the construction project and the finished production facility.

Even the federal government grant of $160 million for accelerated expansion of Interstate 94 in Racine County is nearly double the Foxconn investment to date in the construction project. Moody’s has already downgraded Mount Pleasant’s credit rating, based on what the investor service describes as Foxconn’s anemic hiring and “continual changes in the scope of the project.” Foxconn promised to begin paying real property taxes on the property starting in 2023 at an assessed valuation of $1.4 billion, with overly optimistic local officials predicting collection of $886 million in property taxes through 2047, roughly equal to the promised public investment in the project. Apparently, the Mount Pleasant officials have not closely followed the Motorola site’s history of successive price reductions in public auctions for sale to speculators of that completed facility, and purchasers’ failure to pay even the resulting smaller property taxes on the factory.