(MENAFN- Trend News Agency) BAKU, Azerbaijan, June 16. Foxconn, best known
as the maker of the iconic Apple iPhone, is looking to enter the
electric vehicle (EV) manufacturing space in India, according to
people directly in the know who said the Taiwanese contract
manufacturer has been in talks with some state governments to
further its plans.
In its annual report, published on May 31, Foxconn said that
India will assist with the establishment of a production line this
year to provide two-wheeled EV manufacturing services that will
cater to the EV two-wheeler market in Southeast Asia.
This marks the first instance where the Taiwanese company has
explicitly stated its plans to further its EV manufacturing
ambitions in India.
Sources also told ET that an Indian delegation is set to visit
Taiwan soon and would meet with Foxconn executives to discuss the
company's EV plans.
“It is still unclear if Foxconn will do contract manufacturing
for multiple brands or for a single brand through the JV (joint
venture) route,” said one of the people cited above.
“They have a tie-up with Ather Energy (electric scooter maker)
but it is likely that they will look for a partner when they come
into the space - possibly with one of the (Indian) auto giants -
like they did for semiconductors,” the person added.
In February 2022, Vedanta and Hon Hai Technology Group (Foxconn)
had announced a JV to manufacture semiconductors in India.
'Company aims to be Android of EV
ecosystem'
Meanwhile, officials from four states - Maharashtra, Telangana,
Tamil Nadu and Andhra Pradesh - had met top Foxconn executives
during their visit to the country last year to discuss EV
manufacturing plans, sources said.
A person in the know of Foxconn's thinking on the matter said
that while the company is keen on Maharashtra as a base for EV
manufacturing,“there were some challenges that cropped up. So they
might consider Tamil Nadu as it has an auto manufacturing hub and
Foxconn already has a presence in the state”.
The company is also looking at Telangana as it is“the most
active state in terms of outreach and incentive”.
ET's e-mailed queries to Foxconn on its EV manufacturing plans
did not elicit a response until press time.
Last year, during Foxconn Chairman Young Liu's first visit to
India, Prime Minister Narendra Modi tweeted that the Taiwanese
company's“push for EV manufacturing is in line with our commitment
of Net Zero Emission”.
To be sure, Bharat FIH, which is a Foxconn Technology Group
company, had said that it has commenced business with companies
such as EV makers Ather Energy and Ola Electric. It also mentioned
other players like consumer electronic company Vu Technologies
Private and ZTE Telecom India (telecom and networking products),
and wearables maker Imagine Marketing (boAt), in its draft red
herring prospectus dated December 21, 2021.
Mobility Push
Pointing out that“mobility is a new space for Foxconn”, Neil
Shah, vice president of research at Counterpoint Research, said the
contract manufacturer is adopting the“Build-Operate-Localise (BOL)
model” in EV manufacturing.
“They want to become the Android of the EV ecosystem,” he
added.
The company will look to build a vertical platform including
manufacturing, hardware, component manufacturing, and battery
management. And then partner with local firms through its MIH
(Mobility in Harmony) platform.
Foxconn's MIH Consortium is an open EV alliance that promotes
collaboration in the mobility industry.
The company's latest annual report -- reviewed by ET --says that
it will cooperate and strive with more than 1,500 member companies
at home and abroad“to become the Android platform of the electric
vehicle industry”.
Shah is of the view that the Taiwanese manufacturer is looking
to break the slowness in the automotive industry dominated by a few
OEMs which control most of the R&D and supply.
“It is a closed ecosystem and Foxconn wants to open it up by
leveraging local partnerships and local suppliers in markets like
India, Indonesia, and Europe, and expand their manufacturing,” he
added.
Global Moves
Foxconn, which gained global recognition for being Apple's
largest contract manufacturer, now has its eyes fixed on the
mobility space. Currently, it has car projects running with the
Yulon Group in Taiwan, with Fisker Inc. and Lordstown Motors in the
US, and with state oil company PTT in Thailand, among others. In
November 2022, it announced that it was teaming up with the Saudi
Public Investment Fund to create a new EV brand called Ceer.
Experts said that India's large consumer market, favourable
demographics, and government initiatives like“Make in India” are
drawing several companies to invest in manufacturing facilities
within the country.
“India is expected to become a sizeable EV market ($100B+
opportunity by 2030 across value chain) driven by strong domestic
demand, favorable regulatory environment and OEM push,” said Deepak
Jain, Partner, Bain & Company.
“A strong talent base and well-established automotive
manufacturing sector indicate strong potential to become an EV
manufacturing hub. Entry of low-cost contract manufacturers will be
a definite boost for E2W (electric two-wheeler) players struggling
to scale,” he added.
Foxconn said in addition to the automotive strategy, it is also
focused on the development of EV components.