Hon Hai Precision Industry, also known as Foxconn, has invested an additional US$168 million in its operations in Mexico this August.

The funds were injected through Foxconn’s Singapore-based subsidiary, Cloud Network Technology, into FII AMC Mexico, which is owned by Foxconn Industrial Internet.

This marks the company’s second major investment in Mexico this month, after a US$45 million capital infusion on August 13, 2025.

Foxconn controls a significant AI server production facility in Mexico through these entities.

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🔗 Source: Focus Taiwan

🧠 Food for thought

1️⃣ Foxconn’s Mexico strategy represents a dramatic acceleration after decades of gradual expansion

Foxconn’s $168 million investment in Mexico marks a significant escalation from its traditionally measured approach to the market.

The company has maintained operations in Mexico for over two decades, starting with an $18 million acquisition of a Motorola cellphone plant in 20032.

Over the years, it built a substantial presence with 14 manufacturing plants across nine Mexican cities employing over 35,000 workers3.

However, the recent $213 million invested in Mexico during August 2024 alone—combining the $168 million and earlier $45 million injection1—exceeds many of its historical single investments in the country.

This acceleration reflects the company’s urgent need to capture the AI server opportunity, where it holds a 40% global market share4 and projects AI server revenue will exceed $32.82 billion in 20251.

2️⃣ The investment timing capitalizes on explosive AI infrastructure demand that validates Foxconn’s market position

Foxconn’s Mexico expansion aligns precisely with unprecedented growth in the AI server market, which is projected to surge from $128 billion in 2024 to $1.56 trillion by 20345.

The company’s AI server revenue is expected to jump more than 50% in 2025 to over $32.82 billion, representing roughly half of its total server business1, 3.

This growth trajectory is driven by hyperscale cloud providers’ heavy investments in AI capabilities, with major U.S. data center operators accounting for over 60% of high-end AI server demand6.

By establishing AI server production capacity in Mexico, Foxconn positions itself to serve the North American market more efficiently while leveraging the country’s trade agreements to distribute products to over 40 countries7.

The strategic location also helps the company navigate potential tariff challenges through its regionalized manufacturing approach across 223 plants in 24 countries1.

Recent Foxconn developments

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