Foxconn plans to build $9 billion factory in Saudi Arabia

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Apple assembly partner Foxconn plans to build a $9 billion new factory in Saudi Arabia, a report claims, one that could be used to expand its business into auto manufacturing, possibly even the Apple Car.

As a major contract manufacturer, Foxconn uses many of its factories to build Apple products such as iPhones. In a report Monday, the company appears to be planning to build another factory, this time in Saudi Arabia.

Hon Hai Precision Industry Co. The Saudi government has made an offer for a two-line foundry, which will be used for “surface mounting technology and water production,” Wall Street Journal sources say. The $9 billion facility will apparently be able to manufacture items such as microchips, electric vehicle components and display electronics.

The offer is apparently under review, with both parties asking for guarantees about the end result of the project. The Saudi government would like Foxconn to guarantee that at least two-thirds of production will be put into Foxconn’s existing supply chain so that the company will be profitable.

Meanwhile, Foxconn apparently wants incentives like financing, tax exemptions, and power and water subsidies. This would be in exchange for setting up a major factory in Neom, a technology-based city-state in underdevelopment, as Saudi Arabia tries to diversify away from oil.

Foxconn may not necessarily build its facility in Saudi Arabia. It is also reportedly in talks with the United Arab Emirates about a similar project.

A demand for manufactured products to be incorporated into existing supply chains still leaves Foxconn ample room to use the facility for other product types separate from the existing supply chain. This could theoretically include vehicles, a segment Foxconn likes to participate in.

Such a facility could also help Foxconn diversify its own manufacturing, allowing it to insulate its company from global events such as trade disputes, war, and pandemics such as COVID-19.

This post Foxconn plans to build $9 billion factory in Saudi Arabia

was original published at “https://appleinsider.com/articles/22/03/14/foxconn-plans-to-build-a-9b-factory-in-saudi-arabia?utm_medium=rss”