The steep price of bringing Foxconn to southeast Wisconsin would be softened if the region becomes a center for innovation and development, says Art Cyr, Director of the Clausen Center for World Business at Carthage College.
Cyr says research published in the Harvard Business Review a few years ago found a direct link between manufacturing sites and the presence of research centers.
Foxconn would create up to 13,000 jobs in Wisconsin in exchange for $3 billion in incentives spread over 15 years, according to the memorandum of understanding that was signed Thursday in Milwaukee. Gov. Walker says the investment could indirectly lead to another 22,000 jobs.
"Beyond the thousands of jobs you should look to what this promises in terms of income...and also the likelihood of technological innovation," Cyr said on Thursday's Morning Show. "I don't know but it's reasonable to speculate that one reason why this area is desirable for Foxconn and other companies is the power house of Madison and the University of Wisconsin in general and other institutions," Cyr said.
Cyr's comments came before additional details of the agreement were released on Friday.
Foxconn has a reputation for not always following through on expansion plans.
Cyr, though, says this deal seems different for several reasons.
For one thing, the Wisconsin agreement is the result of a series of face-to-face meetings between Walker and Foxconn Chairman Terry Gou. They seem to have forged a close personal relationship. Another difference is the personal involvement of President Trump.
In addition, the company is in need of good press following reports a few years back of poor working conditions and worker suicides in China, Cyr said.
"They would pay a price I think if they would pull the plug on this one," Cyr said.
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