Foxconn to expand U.S. operations at Wisconsin site with $549 million investment —Taiwanese company gets approval for more AI data center industry in Racine County

Electronics assembly company Foxconn, which is known for building iPhones for Apple, announced that it has just received regulatory approval to expand its Wisconsin factory. According to Reuters, the Wisconsin Economic Development Corporation (WEDC) has just approved the company’s additional $549 million investment to expand its operations in Racine County. This will help the manufacturer build more AI servers for its clients, especially as demand is steadily increasing.

“As the demand for more data infrastructure continues to rise, Foxconn will keep responding to our customers’ needs with flexibility and at scale in the United States,” Foxconn chief product officer Jerry Hsiao told Reuters. The move will not only increase the company’s output, but it will also result in 1,374 new jobs — effectively doubling the workforce in the state, which already accounts for 25% of the company’s workforce in the U.S.

The burgeoning AI demand across the industry has been fueling massive investments in chip fabs. TSMC and SoftBank are looking to spend $1 trillion to turn Arizona into a center for artificial intelligence and robotics and compete with Shenzhen. U.S. President Donald Trump even signed an executive order for the “Genesis Mission,” which the White House is comparing to the Manhattan Project of World War II in terms of its scale. Aside from these plans, we also have numerous data centers going up in different sites all over the United States, with companies such as Microsoft rushing to bring them into service because they do not have enough “warm shells” to plug their GPUs into.

This, in turn, is driving demand for hardware, such as high-bandwidth memory chips, resulting in shortages for the average consumer. The massive demand for AI GPUs with their high-bandwidth memory chips has led many memory chip makers to prioritize this over standard DRAM and NAND chips used for consumer memory and storage.

Experts say that we could be facing a “pricing apocalypse” on these modules that could last a decade. In fact, we already see several vendors across the world increasing memory prices to ridiculous levels due to the lack of supply. Many manufacturers have even resorted to panic buying existing stocks in the open market to supplement their long-term contracts and stockpile RAM stocks.

Despite this, memory chip makers like Micron, SK hynix, and Samsung reportedly have no plans to build new fabs to increase production. This is because they’re wary of an AI bubble, which many experts say we are already in, that could pop anytime. Should that happen, they would be left with massive infrastructure and production capacity but with no customers to use them.

Still, this is a hopeful development for the Wisconsin plant, which has seen a number of ups and downs in recent years. Foxconn initially announced in 2017 that it acquired the property to build a $10-billion LCD manufacturing plant — but things seem to have changed in 2018, when the company scaled back its plans even after it had already received $4 billion in subsidies from the state of Wisconsin. Then, in 2019, it said that it had scrapped its plans for the factory, only to turn around shortly after and say that it was back on track.

Today, the site is building AI data servers, and the massive demand from the industry seems to be driving Foxconn to increase its investments in the area. This additional half-billion-dollar investment would hopefully serve the community, bringing in jobs and opportunities for the people around it.

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