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State-of-the-art gummy bears

Hey y'all, it's Austin. The future of American manufacturing may not rely on ultra-flat-screen TVs, robotic coffee baristas or even electric vehicles. It might just depend on gummy bears.

Last week, Taiwanese manufacturing giant Foxconn Technology Group teased a major update to its government-subsidized Wisconsin factory. The project has come under fire for years over inexplicable delays and opaque changes. The world's largest electronics contract manufacturer said Wisconsin could be the home of its future electric-car plant, which would give the Badger State a manufacturing foothold in the hot automotive market.

Wisconsin leaders weren't immediately enamored with Foxconn's promise du jour. Days after the news, the state economic agency overseeing the Foxconn development published a newsletter that touted not the potential for EV production but, of all things, gummy bear manufacturing. The century-old German candy maker Haribo GmbH, the agency wrote, is building a new "state-of-the-art facility" that's expected to churn out 132 million pounds of confections annually and create 385 jobs.

For Wisconsinites who have waited for Foxconn to deliver on pledge after pledge to make gadgets in the state, gummy bears will feel like a more realistic alternative. In exchange for billions of dollars in possible public subsidies, Foxconn originally committed to investing $10 billion in a high-tech manufacturing operation south of Milwaukee that would create as many 13,000 jobs. But more than three years after the striking its agreement, Foxconn's latest EV pitch is a reminder that the company still has no concrete plan for what it's going to build there.

"I took over the Wisconsin task, and I need to make it a viable one, so I need to find a product that fits that location," said Foxconn Chairman Young Liu. He added that the company is also considering Mexico for the electric-car plant instead. "My consideration first would be to have a product that makes sense. That's number one."

Since 2017, Foxconn has hyped a long list of products that it planned to make in Wisconsin. At first, the company committed to constructing a massive display factory but then backed away from that promise. Then it announced a plan to produce futuristic coffee kiosks, only for that plan to fall apart, too. During some of the darkest days of the coronavirus pandemic, Foxconn unveiled a goal to produce 10,000 ventilators in Wisconsin, but that was later scrapped. It also explored making Google servers at the site, as well as oddball projects including the export of dairy products and the creation a WeWork competitor.

During that time, Foxconn fell short on job creation and investment commitments, leading the state to deny tax credits to the company. As of the last available hiring figures, Foxconn had employed just 281 people in the state through 2019, at a stage when it was supposed to have created anywhere from 520 to 2,080 full-time jobs, according to its contract. And it had made only $300 million in capital expenditures on its Wisconsin project.

By comparison, Haribo said it will spend the same amount to create those 385 jobs by late next year in exchange for $22.5 million in eligible tax credits, a fraction of the scale of Foxconn's subsidy package. The candy maker broke ground on its factory in December. Even Amazon.com Inc., which is quite adept at securing tax breaks, got far less in incentives for its 2019 warehouse project in Wisconsin than Foxconn did. Amazon opened for business last October and could employ 1,500 workers.

But the Foxconn deal was sold as something special. It wasn't pitching jobs to make confection or pack boxes to stick in the mail. Foxconn would bring back high-tech manufacturing from Asia and turn Wisconsin into a glitzy hub for high-skill jobs. Coffee robots may or may not be in our future, but for now, gummy bears are a safer bet.Austin Carr

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