OTHER ELECTRONICS & NANOTECHNOLOGY
INDUSTRY UPDATE
October 2020
McIlvaine Company
Prospects
for WI Plant Could be 'Dead'
An analyst hired by the state of Wisconsin
has called the $10 billion Foxconn project “dead” as tax breaks and government
aid become more and more crucial to keeping the agreement afloat.
Last month, Foxconn founder Terry Gou said
that the company’s commitment to the project depends on government aid. Shortly
after, Foxconn Technology Group decided to challenge a decision by the Wisconsin
Economic Development Corp. not to issue the company tax credits.
Some Contract & Project History
In April 2018, Foxconn named Providence,
Rhode Island-based Gilbane (which has a Milwaukee office) and global firm M+W
Group (Stuttgart, Germany) as its lead contractors on the 20 million square feet
of building space that will eventually employ 13,000 people.
Officials announced the first round of
contracts that July, worth $14 million, that went toward a multi-purpose
building on the site, which is now complete.
However, 2019 opened with a Jan. 17 letter in
which the company disclosed that it would not make the threshold of job creation
needed in order to receive about $9.5 million in tax credits.
(Foxconn is under an agreement with jobs
agency Wisconsin Economic Development Corp. to create up to 13,000 jobs over the
course of construction, which would then qualify the company to be awarded up to
$3 billion in tax credits.)
The contract with WEDC extends well beyond
the completion of construction, however, over the first 15 years of the
contract, which ends in 2027, the minimum hiring number dips to 10,400 and the
company must continue employing that many people through 2032.
Shortly after, the company noted that it was
no longer sure that the facility would be solely focused on making flat screens
as originally pitched. According to a report by Reuters, which spoke to Louis
Woo, special assistant to Foxconn Chief Executive Terry Gou, the company would
now focus on creating a “technology hub” rather than LCD manufacturing.
While it promises to maintain the numbers in
terms of job creation, the type of jobs that will now be up for grabs will
reportedly be totally different, and will include more research and development
and design positions rather than manufacturing jobs.
Woo cited the cost of labor in the United
States for the shift.
Bid packages for the construction of the
massive manufacturing facility began issuing in May and later that month Foxconn
awarded $13 million in contracts for foundation-related work to C.D. Smith
Construction Inc. Crews began pouring concrete in late June.
Also, in early summer, officials awarded
nearly 40 other contracts—the financial terms of which were not disclosed—and
renderings for the property were released as well.
The area is designed by three Taiwanese
companies that include JJP Taipei, Team Engineering Consulting and United
Integrated Services, while the building shell is designed by Eppstein Uhen
Architects in Milwaukee. Graef is the engineer of record and The Sigma Group is
civil engineer. New York-based Exyte, which has specialization in cleanrooms, is
leading the design team.
In August, it was reported that walls were
going up at the 1 million-square-foot plant. About 200 workers installed 400
precast concrete panels and structural steel work, led by general contractor
Gilbane Building Co.
Echoing the shift in focus, in September,
Foxconn announced that it had chosen Mortenson Construction (Minneapolis) to
serve as construction manager for two facilities that were recently approved as
part of the plan to support “smart manufacturing,” which include a Smart
Manufacturing Center and the High-Performance Computing Data Center.
At the time, Mortenson announced an
invitation to bid on the core and shell of the SMC, seeking contracts for:
earthwork, site utilities, asphalt, site concrete, landscaping, concrete
reinforcing materials, concrete reinforcing install, SOG concrete, precast,
steel, metal panels, roofing, overhead doors, glazing, skylights, exterior
sheathing and air barriers, loading dock equipment, elevators, temporary
fencing, masonry, testing services and concrete Redi-Mix materials.
In October, the Milwaukee Journal Sentinel
reported that Foxconn awarded another $83 million in contracts. In addition to
that, Patch also reported that installation had begun on the 1
million-square-foot factory’s roof. For the installation, 16,000 yards of
concrete will be poured onto the metal deck and will reportedly be completed by
three roofing crews.
Last month, Foxconn founder Terry Gou said
that the company’s commitment to the project depends on government aid. Shortly
after, Foxconn Technology Group decided to challenge a decision by the Wisconsin
Economic Development Corp. not to issue the company tax credits.
Designs for the data center were also
released, which include not only the 34,250-square-foot building but a
100-foot-tall “networks operations center globe,” which is set to include a
240-seat auditorium, board rooms and more office space. Both are also designed
by Eppstein.
At the end of the year, letters between State
Department of Administration Secretary Joel Brennan and Foxconn Industrial
Internet Chief Business Officer Richard Vincent were released by Wisconsin Gov.
Tony Evers’ administration that discussed whether the project will even qualify
for the agreed-upon $3 billion incentive package.
This year started off with a $2.3 million
contract award for subcontracts under the project’s High-Performance Computing
Data Center Bid Package No. 1.
That brought the total value for contracts
awarded to the $10 billion project to $372 million. Most of those subcontracts
focuses on concrete work.
What Now
“Right now it looks dead,” Display Supply
Chain Consultants CEO Ross Young told EE Times in an interview. “They only built
a storage facility and are not getting the subsidies they need. We do not
anticipate any more G10.5 LCD fabs being built. The industry has sufficient
capacity. In fact, the Korean suppliers Samsung and LGD are shutting down a
significant amount of capacity and looking to exit the LCD TV panel market as
Chinese government subsidized capacity drove prices down.”
According to the Times, the Taiwan-based
company failed to meet the targets that would have qualified it to receive up to
$19.1 million in job-creation tax credits and another $192.9 million in
capital-investment tax credits for jobs and investments in 2019.
On Oct. 12 WEDC decided not to issue tax
credits to Foxconn for capital investment and hiring in 2019. The state agency
determined that Foxconn only hired 281 full-time employees and only made $300
million in capital expenditures.
Foxconn has maintained, however, that it
hired more than 520 eligible full-time worked and that it invested $750 million.
Robert Berry, attorney with Foxconn, sent a
letter to Jennifer Campbell, chief legal officer for WEDC, at the end of last
month saying the company objects to the decision specifically “regarding terms
and timelines.”
“Despite frustrations and disappointment with
WEDC’s decision and the method chosen by the WEDC to inform the (company) of its
determination, it is the (company’s) intention to continue to work with the WEDC
in good faith to resolve this disagreement within the next 30 days in a manner
that benefits interested parties, including Racine County and the village of
Mount Pleasant,” the letter reads.
EVG Completes
New Cleanroom Facility
Newly opened Cleanroom V building nearly
doubles cleanroom capacity and strengthens capabilities of NILPhotonics and
Heterogeneous Integration Competence Centres
EV Group (EVG), a supplier of wafer bonding
and lithography equipment for semiconductor, MEMS and nanotechnology markets,
has completed construction of its new Cleanroom V building at its corporate
headquarters in Austria.
Built from top to bottom with the latest
cleanroom design and construction technology, the new building nearly doubles
the cleanroom capacity at EVG's headquarters, and will be used for product and
process development, equipment demonstrations, prototyping and pilot-line
production services. The Cleanroom V building, which is part of a €30 million
investment announced last year, is open now.
The new Cleanroom V building is directly
connected to EVG's existing cleanroom and applications lab, and provides
approximately 6,671 sq. ft. (620 square meters) of additional Class 10 cleanroom
floor space. The new building also houses a modern training center with multiple
dedicated areas for training customers and field service engineers on EVG
equipment platforms. As part of the expansion investment, the existing cleanroom
and applications lab facility have also been upgraded, including the creation of
redundant systems to ensure the highest availability and new safety features.
EV Group personnel are finalizing the
interior of the new facility, which includes dedicated co-development areas.
The advanced sub-fab of EV Group's Cleanroom
V facility has been designed with redundant systems to ensure the highest
availability and new safety features.
The added capacity afforded by the new
Cleanroom V building will strengthen the capabilities of EVG's NILPhotonics
Competence Centre and Heterogeneous Integration Competence Centre, which provide
world-class process development services, and serve as open access innovation
incubators for customers and partners across the microelectronics supply chain.
Through these centers of technology
excellence, EVG helps customers to accelerate technology development, minimize
risk, and develop differentiating technologies and products through the
implementation of nanoimprint lithography and heterogeneous integration,
respectively, while guaranteeing the highest IP protection standards that are
required for working on pre-release products.
"We are extremely proud of the technical
innovation and know-how that went into the construction of this new cleanroom.
It is truly a world-class, state-of-the-art facility down to the smallest
details - arguably on par with some of the most technically advanced cleanrooms
in Europe," stated Markus Wimplinger, corporate technology development & IP
director at EV Group.
"For EVG, this new facility will greatly
enhance our ability to co-develop future applications and technologies with our
customers. In particular, we see it benefiting our Competence Centres, which
have seen particularly strong activity and demand. The unique services offered
at our NILPhotonics and Heterogeneous Integration Competence Centres enable our
customers and partners to shorten development cycles and create novel products
in these critical application areas."
McIlvaine Company
Northfield, IL 60093-2743
Tel: 847-784-0012; Fax:
847-784-0061
E-mail:
editor@mcilvainecompany.com
Web site:
www.mcilvainecompany.com