MADISON, Wis. (AP) — Foxconn Technology Group, the world's largest electronics manufacturer, has reached a new deal with reduced tax breaks for its scaled back project in southeast Wisconsin, Gov. Tony Evers and the the company announced on Monday.
Details of the new deal were not immediately released. It was scheduled to be approved at a Tuesday meeting of the Wisconsin Economic Development Corp., the state's top jobs agency that previously negotiated the initial deal with Foxconn.
The original deal with nearly $4 billion in state and local tax incentives was struck in 2017 by then-Gov. Scott Walker. It was based on Taiwan-based Foxconn's promise to build a massive $10 billion flat screen panel manufacturing facility in Mount Pleasant, near the Illinois border, employing up to 13,000 people. Then-President Donald Trump hailed the project as the “eighth wonder of the world.”
But Foxconn, best known for making Apple iPhones, has continually scaled back its plans for the site and missed employment targets that would trigger state tax credits.
Evers, who ran against Walker in 2018 as a critic of the deal, said in a statement Monday that the new deal “works for everyone.”
Jay Lee, Foxconn's vice chairman, said Foxconn approved the new deal with a desire to lower taxpayer liability in exchange for the flexibility to pursue business opportunities the meet market demand."
Foxconn's chairman said last month it was considering making electronic vehicles at the facility.
Featured Article: What is the Gross Domestic Product (GDP)?7 Hotel Stocks Just Waiting For the Vaccine
Like any group of stocks related to travel and tourism, hotel stocks saw a steep drop in share prices in 2020. The leisure and hospitality sector that once had 15 million employees has lost 4 million jobs since February.
Many major cities will be feeling the ripple effects of the Covid-19 pandemic for years. However, there is ample evidence that shows the pandemic may be coming to an end. The number of new cases is dropping. The number of those getting vaccinated is rising. And even in the cities with the most restrictive mitigation measures, the slow process of reopening is beginning.
All of this can’t come fast enough for individuals who rely on the travel and tourism industry for their livelihood. Hotel chains had at least some revenue coming in the door. And when earnings season concludes, the more budget-friendly hotel chains may realize revenue that is 75% of its 2019 numbers. But that is not enough to bring the hotels to anywhere near full employment. Particularly with hotels that have bars and restaurants that have remained closed or open at limited capacity.
Many economists are optimistic that travel may begin to look more normal by the summer of this year. And the global economy may deliver 6.4% GDP growth this year. With that in mind, the hotel chains with the best fundamentals and the broadest footprint will be in the best position as the economy reopens.
View the "7 Hotel Stocks Just Waiting For the Vaccine"