There have been new developments concerning leading contracting manufacturing services provider (CMS), Foxconn Technology, also know as Hon Hai Precision Inc., and this provider’s strategic forays into electric automobile manufacturing.

Multiple news outlets reported this week that the CMS provider has signed a Memorandum of Understanding with California based start-up electric auto maker Fisker to build electric vehicles.

Consumer Electronics manufacturing

In January, this blog highlighted a published Reuters report indicating that China based automaker Geely Holding Group and Foxconn announced a strategic partnership to build automobiles for various branded automakers. In a joint statement each of the partners reportedly indicated that they would have half ownership interest and provide expertise services related to electric automobile volume manufacturing. The presumption was that production would be located at Foxconn’s current facilities to optimize capacity. The CMS reportedly also has an agreement with Fiat Chrysler. Foxconn’s developing strategy is to provide a base technology electronic platform that multiple manufacturers can leverage for vehicle development and volume production.

First reported by The Wall Street Journal, the Foxconn-Fisker MOU reportedly involves the production of more than 250,000 vehicles per year. Of further high interest is exactly where the vehicles are to be produced. According to the WSJ report, the exact location is yet to be determined, but the report cited Fisker’s CEO Henrik Fisker as indicating that there was a good chance that initial production could be at Foxconn’s Wisconsin production complex.

Reportedly this manufacturing collaboration would involve Fisker’s planned second model vehicle- a higher volume electric car planned for late 2023, with plans to sell and distribute the vehicle in North America as well as Europe, China and India. Fisker’s planned initial model market debut of a luxury sport-utility vehicle involves a manufacturing collaboration with auto industry major component supplier Magna International.

The Milwaukee Journal Sentinel reporting on the Fisker news indicated that it received a statement from Foxconn that would not specifically confirm a decision on the Mount Pleasant Wisconsin production complex, but at the same time did not dismiss the possibility. Instead, the CMS stressed that the Mount Pleasant complex would be a hub for next-gen technological product design and smart manufacturing. The local publication added that so far, the Wisconsin facility has only produced face masks.

 

Additional Perspectives

As stated in our prior blog related to Foxconn’s initiatives in automotive manufacturing, the association as go-to strategic contract manufacturing services provider to consumer electronics provider Apple, will fuel more speculation that the consumer electronics icon may end up relying on its go-to partner for its rumored entry into electric vehicles. Both Apple and Fisker share the Silicon Valley’s high tech industry preference for asset light infrastructure when it comes to manufacturing. For electric vehicles, the important difference is Tesla, that continues to pursue a strategy of owned manufacturing, which the automaker now moving toward a global-wide presence of owned manufacturing.

Now that news has come to light that Apple’s supposed secret talks with Hyundai Motor Group to assemble an electric autonomous vehicle in the U.S., the speculation of an added collaboration with Foxconn will become more of a buzz.

Beyond speculation are the quite visible signs that the product design, component supply and manufacturing networks of both consumer electronics and electric powered automobiles are coming together in the not-too-distant future.

 

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