Data Points

Foxconn and TECO-Westinghouse set to work together on data center projects

Hon Hai Technology Group (the parent company of Foxconn) and TECO Electric & Machinery Co. made a big announcement Wednesday. The two companies reportedly agreed on a share exchange and strategic alliance that will "strengthen their AI infrastructure capabilities and propel the two Taiwanese tech majors into key markets in the global super-computing race."

The move brings together the strengths of Foxconn, the world’s largest electronics manufacturing service provider and AI server producer, and TECO, a leader in industrial electro-mechanical engineering and green energy innovation. Seizing on the development of global AI data center (AIDC) construction towards standardization and modularization, the two companies will jointly explore AIDC business opportunities. Global customers are expected to be able to tap comprehensive data center modular products, electromechanical engineering services, and cost-competitive, one-stop solutions.

The Wisconsin Valley Science and Technology Park, a Foxconn facility located in Mount Pleasant, WI.--Foxconn photo

Foxconn Chairman Young Liu said, “Time-to-market is key in the global super-computing race. Modular design is gaining popularity. As AI data centers grow in size and demand ramps higher, teaming up with TECO means both companies are able to level up and rapidly deliver comprehensive, vertically-integrated solutions to our customers – the Tier-1 CSPs and hyperscalers.”

TECO Chairman Morris Li said, “Changing global dynamics are creating new opportunities for business and cooperation. The strategic partnership extends the two companies’ cooperation in the fields of low-carbon smart factories and energy services, toward being a one-stop solution for data centers going forward.”

Target markets cover Taiwan and Asia, as well as the Middle East and the US.

Foxconn has deep vertical integration capabilities in manufacturing AI server racks and an unrivaled customer base. Liu said Foxconn will actively develop a modular architecture for AI data centers, and with TECO aim to extend the value chain from server components and racks to data center construction.

Li said that Texas-based TECO-Westinghouse, a longstanding world leader in manufacturing electric motors, has the advantages of American manufacturing and local services. Together with Foxconn's manufacturing base in the United States, "it is in line with the strategic direction of the two companies to expand American manufacturing and reshape the global supply chain," he added.

Previously cooperating in factory energy saving and emission reduction, and ESCO energy services, TECO and Foxconn have started discussions on establishing data center business in Taiwan and the United States. Since a data center is mainly composed of equipment inside the computer room (servers, cooling systems, UPS, etc.) and power infrastructure outside the computer room, the strategic alliance integrates the combined strengths each bring in their respective fields of AI servers, electromechanics, information and communications.