Mexico will host the world’s largest “superchip” factory thanks to the Taiwanese giant Foxconn | artificial intelligence | Nvidia | Hon Hai Precision Industry

Taiwanese technology giant Foxconn will build in Mexico the world’s largest plant for the manufacture of GB200 “superchips” from the American group Nvidia, designed for servers of artificial intelligence (IA).

Foxconn, whose official name is Hon Hai Precision Industry, is the world’s largest contract electronics manufacturer and counts major technology companies, including Apple, among its clients.

The megafactory will be built in the state of Jalisco (west), with coasts on the Pacific and world-famous for the production of tequila, the regional governor, Enrique Alfaro, confirmed this Wednesday at a press conference in the city of Guadalajara.

“It is news of the greatest relevance for Jalisco and for the country,” said the governor.

It represents “the possibility of Jalisco consolidating itself as the main innovation hub in Latin America,” highlighted Alfaro.

Construction of the complex was announced Tuesday by Benjamin Ting, Foxconn’s vice president for cloud business solutions. It will assemble GB200 “superchips” from the Nvidia group.

“We are building the largest GB200 production plant on the planet,” Ting said at the company’s annual Hon Hai Technology Day.

The company’s president, Young Liu, later told reporters that the new plant will be built in Mexico, without detailing the amount of the investment.

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“A before and after”

Foxconn has also expanded into other areas such as electric vehicles, semiconductors and servers.

The governor of Jalisco commented that the investment by the Taiwanese group was finalized after two years of conversations and will mark “a before and after in the manufacturing industry” of Mexico, the 12th largest economy in the world.

“Mexico is entering the era of cutting-edge super chips,” the Secretary (Minister) of Economy, Marcelo Ebrard, highlighted in X.

The governor explained that a confidentiality agreement prevents him for now from revealing the exact location where the factory will operate, but he insisted that “the decision has been made.”

In fact, the acquisition of the land was already underway before the announcement, said the president, whose state is suffering from the onslaught of violent drug trafficking cartels.

Nvidia does not make its own chips, unlike rivals Intel, Micron and Texas Instruments, but instead uses subcontractors.

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Foxconn announced last year an alliance with Nvidia to create “AI factories,” data processing centers that would boost the manufacturing of next-generation products.

Relief against Tesla

The completion of the megaplant is a relief for Mexico, after Tesla’s decision to postpone the construction of an electric car factory in the city of Monterrey (north) pending the presidential elections in the United States.

The company of tycoon Elon Musk had planned to invest about $5 billion in this project, which is part of expectations about a relocation of companies to the Mexican side of the border with the United States, the world’s largest economy.

Mexico is also part of a US initiative to develop semiconductors, at a time when it is fighting a battle with China, its main rival, to dominate these essential components for many electronic devices such as phones, computers, drones and military equipment.

Foxconn was already present in Mexico with a high-tech electronic card manufacturing plant inaugurated in Jalisco in 2022.

According to the Industriales Jalisco union, this factory represented an investment of 100 million dollars.

In alliance with the German ZF, Foxconn also launched a plant in Toluca (center) last June for the production of chassis assemblies for cars for the North American market, with an investment of about 42 million dollars.

Likewise, in 2023 the Asian firm announced an alliance with the government of Chihuahua (north) for the development of sustainable energies.