TAIPEI (Taiwan News) — As China’s economy shows signs of increasing instability, Taiwan’s Foxconn has its eye on investments in North America.

The refocus on Mexico and the U.S. is also in response to the growing demand for electric vehicles and related smart technologies in the North American region. Foxconn is also shifting some resources away from smartphones to focus on the electric vehicle market.

The company has secured several new clients in Mexico in recent months and established a headquarters in the country to “centralize the management of its subsidiaries,” and to “maximize its resources” in North America, reported Nikkei.



Quoting an anonymous source with “direct knowledge” of Foxconn’s plans, Nikkei reported that the company considers Mexico a key location for strategic investment. Moving forward, Foxconn will have three options for partners in electronic vehicle manufacturing, including sites in Ohio, Wisconsin, and Mexico, the report said.

Foxconn is not the only Taiwanese tech company eyeing Mexico for investment. Other key companies noted in the Nikkei report are Pegatron, Quanta Computer, Compal Electronics and Inventec.

Two primary factors are driving manufacturing towards Mexico and away from China. The most immediate is U.S. trade policy; Washington is determined to revive the local semiconductor industry and deprive Beijing of crucial tech advances over the coming years.

The second major factor is China’s rapidly diminishing working-age population, which will preclude economic growth in the decade ahead. Beijing further stymied its economic prospects with its recent response to COVID, which disrupted global supply chains and made many question the country's role as a major manufacturing base.

In contrast, Mexico has a strong internal market with a growing population, comparatively low costs, and a strategic geographic position providing access to the U.S., South America and both the Pacific and Atlantic Oceans.