Taiwan-based Foxconn, best known for assembling Apple iPhones, is partnering with US electric vehicle manufacturer Fisker to make more than 250,000 electric cars a year.
The joint venture, which will begin production by the last quarter of 2023, is codenamed PEAR (Personal Electric Automotive Revolution). It will target consumers in North America, Europe, China and India, the companies said in a joint statement.
“We will create a vehicle that crosses social borders, while offering a combination of advanced technology, desirable design, innovation and value for money … while delivering on our commitment to create the world’s most sustainable vehicles,” Henrik Fisker, the car maker’s chairman and chief executive, said.
Fisker, which went public last year, surged more than 38 per cent to $22.60 a share on Wednesday after the plans were announced.
The California-based company plans to launch its first vehicle, the Ocean electric SUV by the end of next year and has already received more than 12,000 deposits for vehicles. A prototype will be unveiled by the end of this year.
Global sales of EVs accelerated last year, rising 43 per cent to more than 3.2 million, according to Sweden-based consultancy EV-volumes.com. Tesla sold the most electric cars, delivering nearly 500,000 vehicles, followed by Volkswagen.
The overall EV market was valued at $162.3 billion in 2019 and is projected to reach $802.8bn by 2027, growing at an annual rate of almost 23 per cent, according to a report published by India-based Allied Market Research.
“We have two major advantages … an exceptional vertically integrated global supply chain and the best supply chain management team in our industry,” Foxconn’s group chairman Young-way Liu said.
“The new collaboration … [will] revolutionise the automotive industry model by introducing ICT capabilities, which help auto makers accelerate their transition to new, innovative and efficient manufacturing processes and business models,” he added.
This combined experience will shorten the amount of time it takes to move from research and development to the first vehicles rolling off the production line to just 24 months, “reducing half of the traditional time required to bring a new vehicle to market”, Mr Liu said.
The companies are establishing several work streams focused on design, technology, engineering and manufacturing. They are expected to conclude discussions and enter into a formal partnership agreement by June this year.
Foxconn, whose main listed arm is Hon Hai Precision Industry, also agreed a deal last month to invest a reported $200 million in embattled Chinese EV start-up Byton. Its funding will help accelerate production of Byton's first vehicle, M-Byte, which is expected to begin mass production by the first quarter of next year.