Foxconn is in talks with Saudi Arabia about a partnership contract to build a factory for microchips, electric vehicles, and other electronic components and devices, according to a report in the Wall Street Journal, citing sources familiar with the matter.

Saudi negotiations with “Foxconn” to manufacture electric cars in the Kingdom

The newspaper noted that the Saudi government is reviewing an offer from the company, officially known as Hon Hai Precision Industries, to build a dual-line plant for surface-mount technology and wafer-making in NEOM, a technology-focused city that the kingdom is developing.

One person said that Saudi Arabia is doing due diligence, comparing the company’s offer to similar projects worldwide.

For its part, Foxconn is seeking significant incentives, including financing, tax breaks, and energy and water subsidies, in return for helping create a high-tech manufacturing sector in the kingdom, as Saudi Arabia aims to diversify its economy away from oil.