Foxconn, Following ‘Personal Conversation’ with Trump, Revives Plans for an LCD Plant in Wisconsin

February 2, 2019, 12:20 AM UTC

Following a “personal conversation” between its CEO and President Trump, Foxconn said Friday that it was once again altering its plans for a controversial facility it’s planning to build in Wisconsin.

Foxconn, the Taiwan-based contract manufacturer also known as Hon Hai Precision Industry, announced at a June 2017 White House ceremony it would spend $10 billion a 20,000-square-foot plant, which would manufacture state-of-the-art LCD panels and eventually employ as many as 13,000 workers.

Wisconsin’s then-governor, Scott Walker, offered Foxconn $3 billion in state subsidies for the project, a move that proved to be controversial enough it that may have cost Walker his re-election last year. As subsidies ballooned above $4 billion, Foxconn said it would build a less-expensive plant making smaller panels and fill many engineering jobs with Chinese nationals.

On Tuesday, Reuters said that Foxconn was again changing its plans for the facility. Instead of an LCD plant, the company would “create a ‘technology hub’ in Wisconsin that would largely consist of research facilities along with packaging and assembly operations.” U.S. labor costs made the costs of manufacturing advanced LCD screens too costly, the company said.

Foxconn said Friday that its CEO Terry Gou met with Trump to discuss its plans for the facility, with both indicating that it would in fact manufacture LCD screens. But instead of the advanced Generation 10.5 screens originally promised in 2017, the plant would be the simpler, Generation 6 option that requires a lower-cost manufacturing facility.

“After productive discussions between the White House and the company, and after a personal conversation between President Donald J. Trump and Chairman Terry Gou, Foxconn is moving forward with our planned construction of a Gen 6 fab facility,” Foxconn said in a statement sent to Fortune. “This campus will serve both as an advanced manufacturing facility as well as a hub of high technology innovation for the region.”

Trump took to Twitter to tout the new plans—which appears to be a return to the old, downscaled plans Foxconn had a week ago. Foxconn’s language about combining a plant with an innovation hub leaves open the question of how many blue-collar jobs the facility will eventually employ. But for now, it looks like all parties have saved some face on this controversial project.