Wed, Mar 05, 2025 page9

• Hon Hai’s AI plant to be completed in a year: governor

  BIG INVESTMENT: Hon Hai is building the world’s largest assembly plant for servers based on Nvidia Corp’s state-of-the-art AI chips, Jalisco Governor Pablo Lemus said

  • Bloomberg
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  The construction of Hon Hai Precision Industry Co’s (鴻海精密) massive artificial intelligence (AI) server plant near Guadalajara, Mexico, would be completed in a year despite the threat of new tariffs from US President Donald Trump, Jalisco Governor Pablo Lemus said.

  Hon Hai, also known as Foxconn Technology Group (富士康科技集團), is investing about US$900 million in what would become the world’s largest assembly plant for servers based on Nvidia Corp’s state-of-the-art GB200 AI chips, Lemus said.

  The project consists of two phases: the expansion of an existing Hon Hai facility in the municipality of El Salto, and the construction of a new plant nearby. Construction “should be finished in a year,” Lemus said, adding that the plant is expected to open late this year or early next year.

  

  A security guard stands next to the logo of Hon Hai Precision Industry Co, also known as Foxconn, at its office in Taipei on May 6 last year.

  Photo: Ritchie B. Tongo, EPA-EFE

  The company is in the process of obtaining permits from the municipal government of El Salto to start the construction of the new plant, said Cindy Blanco, Jalisco’s secretary of economic development.

  The state government would provide fiscal incentives to support the project, and her office would be “as supportive as possible with all the paperwork, whatever they may need, in the process of opening their plant here in the state,” she said.

  Hon Hai began growing its server-related business in Mexico during the first Trump administration as a hedge against US-China tensions.

  While Trump’s 25 percent tariffs on Mexico could risk increasing the cost of doing business in the country for the Taiwanese firm and others, new investment in the state was on the rise and likely to increase this year compared with last year, Lemus said.

  “What various plants have told us is that regardless of what happens with the tariffs announced by President Trump, they will continue working in Mexico,” he said. “Not only have we not seen investments slow down, on the contrary, they continue to arrive in Jalisco.”

  As much as US$300 million is being invested this year in industrial parks across Jalisco, with demand surging. Up to 60 percent of the more than 600,000m2 of available industrial space is already leased, Lemus said.

  Jalisco is home to about 70 percent of companies in Mexico’s semiconductor industry. In addition to the Foxconn plant, ASE Technology Holding Co’s (日月光投控) ISE Labs Inc announced in November last year that it had acquired land in the municipality of Tonala for a new semiconductor packaging and testing facility. Also last year, Micron Technology Inc said that it would establish a new engineering and operations center in Guadalajara. Meanwhile, Mexican President Claudia Sheinbaum’s “Kutsari” initiative — aimed at growing the country’s semiconductor industry — includes plans for a new design center in Jalisco.

  Jalisco would “welcome all investments,” including from China, Lemus said.

  “We cannot limit the arrival of investments from any country,” he said.
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