In August 2025, SoftBank Group acquired Foxconn's electric vehicle (EV) factory in Ohio, USA, for $375 million. The factory was originally purchased by Foxconn's subsidiary, Hon Hai Precision, three years ago for the production of electric vehicles. In this transaction, Foxconn sold the factory to an entity named "Crescent Dune," which is ultimately backed by SoftBank. After the deal is completed, Foxconn will continue to operate the factory and use it for the production of AI servers, with the possibility of converting it into a data center in the future.

This acquisition is one of the key moves by SoftBank to advance its "Stargate" data center project. The project, a collaboration between SoftBank, OpenAI, and Oracle, aims to build large-scale artificial intelligence data centers with an investment of up to $500 billion. However, SoftBank has encountered difficulties in the project's financing plan, struggling to establish a pricing model necessary to support the project's funding. To address this, SoftBank approached Foxconn, hoping to leverage its strong manufacturing and supply chain capabilities to jointly advance the construction of data centers and related infrastructure.

Collaboration and Future Outlook

SoftBank and Foxconn have a long history of collaboration. The two companies worked together to develop the SoftBank humanoid robot Pepper a decade ago and established a joint venture this year focused on developing data centers and manufacturing businesses in the United States. This acquisition further deepens their partnership and injects new momentum into the "Stargate" project. Although the project's progress has not met expectations, SoftBank's Chief Financial Officer, Yoshimitsu Goto, stated that the company expects to soon begin substantive negotiations for the first "Stargate" data center site.

Additionally, the AI servers produced by Foxconn in the factory may use custom AI chips from OpenAI to reduce dependence on Nvidia. Another possibility is that Foxconn will equip the servers with SoftBank's chips, as SoftBank has previously acquired Graphcore, a machine learning accelerator manufacturer, and Ampere, a CPU developer.

Project Impact and Challenges

The "Stargate" project is expected to create over 100,000 jobs in the United States, demonstrating its significant potential in terms of economic and employment impact. However, the project still faces numerous challenges, including US tariff policies, the proliferation of open-source AI models, and difficulties in reaching consensus with partners. Meanwhile, OpenAI is also independently advancing other "Stargate" data center projects, such as the data center in Abilene, Texas, and collaborations in the United Arab Emirates and Norway.

Overall, SoftBank's acquisition of Foxconn's US factory is a crucial step in its strategic layout in the fields of artificial intelligence and data centers. Despite the many challenges, the acquisition provides new opportunities for the advancement of the "Stargate" project and lays a solid foundation for future cooperation between the two parties.

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