Taiwan-based electronics manufacturers Foxconn and Pegatron are now eyeing new factories in Mexico, in the backdrop of the US-China trade war and coronavirus pandemic that is prompting companies to reassess global supply chains.
The plans, if materialize, could likely usher billions of dollars in fresh investments over the next few years for Latin America’s economy, which is already primed for its worst recession since the 1930s Great Depression. There is, however, no confirmation on which companies they would work with in Mexico.
According to reports, Foxconn has plans to use the factory to make Apple iPhones. Foxconn could make a final decision on a new factory later this year, and work will commence after that. Foxconn currently has five factories in Mexico mainly making televisions and servers.
On the other hand, Pegatron is also reportedly in early discussions with lenders about an additional facility in Mexico to assemble chips and other electronic components.
Foxconn said in a statement that while it continued to expand global operations and is an “active investor” in Mexico, it had no current plans to increase those investments. More reports state that Foxconn plans to invest up to $1 billion (approximately Rs. 7,409 crores) to expand a factory in India as well, where it assembles Apple iPhones.
Even Foxconn unit Sharp said it is stepping up television production in Mexico. In fact, last year Sharp said it would set up a plant in Vietnam to shift part of its China production. The Taipei Economic and Cultural Office in Mexico, which represents Taiwan’s government in the country, said it had heard Foxconn was interested in building another factory in Ciudad Juarez, in the northern border state of Chihuahua.
If sources are to be believed, Mexico has spoken to a number of foreign companies to lure business from Asia already. It remains to be seen how these developments materialize in the coming time.