Molly Beck

Milwaukee Journal Sentinel

MADISON — One day after a report that Foxconn was drastically rethinking its operation in southeastern Wisconsin, a Japan-based news outlet reported that the tech giant is halting work on its planned $10 billion plant in southeastern Wisconsin and a second plant in China.

The Taiwanese-based company disputed the report, saying its plans were "unchanged."

The Nikkei Asian Review reported Thursday that Foxconn will suspend work on the Racine County campus and postpone work on a $9 billion display panel project in Guangzhou, China, for at least six months.

The report, citing anonymous sources and documents, said Foxconn's decision to suspend work on the two plants is because of "weakening macroeconomic conditions and the uncertainties brought by the trade war," and in Wisconsin, "as a result of negotiations with new Gov. Tony Evers."

FULL COVERAGE:Foxconn in Wisconsin

The report said Evers approached Foxconn officials to "renegotiate some of the side deals his predecessor made with the company," attributing to three anonymous sources.

However, Foxconn and state officials denied that Evers sought to make changes to the state's contract with Foxconn.

Mark Hogan, CEO of the Wisconsin Economic Development Corp., said Evers never sought to re-negotiate any element of the Foxconn project. Hogan was appointed to his post by Gov. Scott Walker in September 2015.

"I have been involved with the Foxconn project from day one, and there never have been any side deals and the contract stands on its own," Hogan said Thursday. "In addition, there have been no attempts by either the company or the Evers or Walker administrations to renegotiate WEDC’s contract."

He said Evers and his administration "have done a very good job of reaching out to company officials and developing a relationship that will protect our taxpayers’ interests and at the same time, give Foxconn the ability to be successful in Wisconsin.”

Further, Foxconn Technology Group released a statement saying it "remains committed to its long-term investment and creating 13,000 jobs in Wisconsin."

"All interactions to date with Governor Evers and his team have been constructive and we look forward to further discussions as we continue to invest in American talent and broaden the base of our investment within the State of Wisconsin," it said.

Foxconn on Thursday said while the company's "need to be responsive to the global market environment has necessitated a reconsideration of which technology will best suit the needs of its customers, its commitment to the construction of the Wisconn Valley Science and Technology Park campus and the creation of 13,000 jobs in Wisconsin remain unchanged."

In the next 18 months, the company said it plans to construct:

A liquid crystal module backend packaging plant

A high precision molding factory

A system integration assembly facility

A rapid prototyping center to help startups test out their hardware ideas and concepts, which will go in line with building the AI 8K+5G ecosystem

A research and development center

A high-performance data center inside the park or in the vicinity

A town center to support the people working in the Wisconn Valley Park.

The Nikkei report said the company does not plan to abandon the Wisconsin project entirely, "only halt it for further evaluation and discussion with the new governor."

Evers didn't take questions from reporters Thursday after he briefly addressed a task force on transportation, but spokeswoman Melissa Baldauff tweeted "claims made today that @GovEvers has tried to renegotiate the Foxconn contract are false."

RELATED:Wisconsin GOP lawmakers blame Tony Evers for Foxconn's changing plans

President Donald Trump and former Gov. Scott Walker in 2018 attended the groundbreaking of Foxconn's planned U.S. plant in Racine County. Trump predicted the campus would be the "eighth wonder of the world."

Since then, staff from Sharp and Foxconn display subsidiary Innolux that were sent to Wisconsin to work on the project "have been recalled to Japan and Taiwan," Nikkei reported.

A slump in Apple electronic sales is affecting the company's growth, according to the report.

"Foxconn's moves to hold up planned investments come after the company took cost-cutting steps that included shedding 100,000 workers by the end of 2018," the report said. "The business climate is even chillier now that top customer Apple delivered a shocking revenue downgrade this month, citing slowing Chinese sales."

The Nikkei report comes a day after Reuters reported Foxconn was radically rethinking its Racine County project. The report said it would scale back or drop completely the advanced liquid crystal display panels it planned to manufacture, in favor of a research and engineering hub.

RELATED:Report: Foxconn may drop manufacturing as part of drastic rethinking of Racine County campus

As it did on Thursday, Foxconn responded by saying it remained committed to bringing thousands of jobs to the state as promised when Walker struck a deal with the company to build its first U.S. plant in Wisconsin. The deal included about $3 billion in taxpayer-funded subsidies.

Since lawmakers approved the subsidies in 2017, Foxconn has changed course several times. Last year, for example, it walked back its plans to build an LCD factory that would produce huge screens, opting instead for a less-costly plant that would make small panels for devices such as phones and tablets. The company also failed to create enough jobs in 2018 to qualify for state tax credits.

RELATED:Foxconn falls short of first job-creation hurdle but reiterates ultimate employment pledge

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Nikkei Asian Review is part of Nikkei Inc. and is the leading business publication in Japan, with 3 million subscribers. It has 1,300 journalists in 37 bureaus around the world, according to its website. It also owns the Financial Times newspaper and oversees and calculates the Nikkei 225 stock index, Japan's leading stock market index.

Potential changes to Foxconn's plans in Wisconsin caused heartburn for Milwaukee city leaders.

On Thursday, Milwaukee Ald. Robert Bauman said city leaders were anticipating Foxconn providing jobs for low-skilled workers, not research jobs.

"Given that fact, I think we're witnessing the greatest bait and switch that's ever been perpetrated on the State of Wisconsin," Bauman said.

"This was sold as a manufacturing job investment, and it appears there's going to be no manufacturing jobs," he said. "They could have done a research facility in the City of Milwaukee, in a high rise."

Mary Spicuzza, Joe Taschler and Patrick Marley of the Journal Sentinel staff contributed to this report.