Foxconn Technology Group, the largest contract electronics manufacturer and a major supplier to Apple, is in talks with Saudi Arabia about jointly building a $9 billion facility that could make microchips, electric-vehicle components, and other electronics.
Saudi Arabia is now reviewing the company’s offer to build a dual-line semiconductor contract manufacturing facility. It would be built in Neom, which is a tech-focused city-state being developed in the desert.
Foxconn has recently expanded over the past few years into areas including electric vehicles and semiconductors.
Companies are looking to diversify their product lines, especially as tensions between the U.S. and China continue to rise within trading. It has directly impacted the semiconductor industry.
Foxconn is also looking at the United Arab Emirates for a base for their projects as well.
Saudi Arabia is looking for Foxconn to guarantee that two-thirds of the foundry’s production would be guaranteed to go into the existing supply chain.
Foxconn has been signing large investment deals, including big deals with Taiwan and India. Last year, the company scaled back a planned factory that was supposed to be in Wisconsin and was supposed to cost $10 billion.
The company also announced today that it will be halting its operations in Shenzhen as China locks down its tech hub city. China is struggling to pursue its zero-Covid strategy, and lockdowns in major cities are impacting global supply chains. The date of the Foxconn factory resumption will be advised by the Chinese government.
It has two major campuses in the Chinese city and therefore has had to adjust production lines into other sites in order to hopefully fend off massive disruptions.
This may further encourage Foxconn to ensure its factory in Saudi Arabia, experts say.
Among products manufactured by Foxconn include iPhones, iPods, iPads, Blackberries, Xbox One, PlayStation 4, WiiU, Kindles, and Nokia devices.
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