Foxconn, the world’s largest contract assembler of consumer electronics, is in talks with Saudi officials about the prospect of opening a $9 billion factory in NEOM, according to a report in the Wall Street Journal.
The company is looking at jointly building a $9 billion multipurpose facility that could make microchips, electric-vehicle components and other electronics like displays.
Hon Hai Precision Industry Co., Ltd., trading as Foxconn Technology Group and better known simply as Foxconn, is a Taiwanese multinational electronics contract manufacturer. Foxconn operates 12 plants in 9 cities across China and assembles the iPhone for Apple, Inc.
People familiar with the talks between Foxconn and Saudi Arabia said the potential factor would be a dual-line foundry for surface-mount technology and wafer fabrication in Neom. Discussions over the project started last year, those people told the WSJ.
The report added that Riyadh wants the company to guarantee that it would direct at least two-thirds of the foundry’s production into Foxconn’s existing supply chain, one of the people said, “to ensure there are buyers for its products and the project is ultimately profitable.” For its part, according to the report, Foxconn is seeking large incentives including financing, tax holidays and subsidies for power and water.
According to the Wall Street Journal, Foxconn reported that full-year net profit last year rose 37% to a record $4.9 billion on the back of robust demand for consumer electronics and cloud and networking products.
Meanwhile, Saudi Arabia is pressing ahead with a massive green hydrogen project also located in Neom, according to Bloomberg. The Kingdom is on track to sell carbon-free hydrogen from the $5 billion project in Neom by 2026, according to Peter Terium, the head of energy and water for the new region in comments to Bloomberg, which added that engineers have finished flattening the site in northwestern Saudi Arabia and U.S.-based Air Products & Chemicals Inc. will soon begin building the facility.
