Nvidia Partner Foxconn to Build Advanced Blackwell AI Servers in Mexico

The fact that Nvidia built a plant in Guadalajara is a clear example of the trend towards “nearshoring,” which means moving supply chains away from China.

In Mexico, the electronics company Foxconn is building the biggest plant in the world to make Nvidia’s most advanced AI servers. This is a stark example of how global technology supply chains are breaking away from China.

Young Liu, the chair of Foxconn, told customers and partners at the company’s annual technology showcase event in Taipei that the plant in Guadalajara, Mexico, will put together GB200 Blackwell AI servers.

Nvidia’s vice-president Deepu Talla was also at the event and said that demand for the Blackwell platform was “crazy.” Talla didn’t say much about the 450-meter-long plant.

For many years, Western governments and businesses have been trying to get more delicate technology and important supplies made closer to home. They want to do this to become less reliant on China as geopolitical tensions rise and supply chain problems happen.

With the help of multibillion-dollar funding, Washington is trying to bring back semiconductor manufacturing to the United States. This has led companies like Intel, Samsung, and Taiwan Semiconductor Manufacturing Co. to make big investments.

Foxconn still runs a number of huge factories in China, including the biggest iPhone factory in the world.

The Taiwanese company makes more electronics than any other contract manufacturer in the world. They develop, make parts, and put together products like smartphones, industrial robots, and electric vehicles.

China has been told by Liu that its share of the group’s global production footprint will drop to just over 70%. However, this change has been slow because China has had a hard time scaling up low-end, labour-intensive smartphone assembly operations in Southeast Asia and other places.

Foxconn has only stepped up its investments in India in the last year, mostly to make more iPhones.

The output of servers and their parts has changed much more quickly because they are important parts of the infrastructure in data centers for governments and big cloud companies like Google and Amazon.

A trade war started by Donald Trump, the president of the US at the time, and big cloud service providers forced Foxconn and other big electronics contract makers to move server production out of China a few years ago.

Liu thought that the rise of “sovereign AI,” which means that countries need to create their own AI to protect their own national security, would also cause more and more computers to be made in their own countries.

He said, “In addition to sovereign AI, I would like to suggest the idea of a “sovereignty server.” In the future, servers will only be made in countries that need them. That’s the way things are going right now.