Taiwan's Foxconn set to invest in Chinese start-up Byton as it bets on EV sector

Foxconn is a production partner of Apple, which is reportedly considering developing a self-driving car of its own

epa08918174 People work next to the logo of Foxconn Technology Group, during the ceremonial opening of Foxconn Research institute in Taipei, Taiwan, 04 January 2021. According to news reports, Foxconn Technology Group is in talks to China based electric-vehicle startup company Byton LTD. for funding that could mark a large bet on the electric car business.  EPA/RITCHIE B. TONGO
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Apple supplier Foxconn Technology is in talks to invest in embattled Chinese electric-vehicle start-up Byton in a deal that could mark a large bet by the iPhone assembler on the car-making business.

Foxconn, whose main listed arm is Hon Hai Precision Industry, plans to invest around $200 million and the companies aim to start mass production of the Byton M-Byte by the first quarter of 2022, saidone of the sources , who declined to be named. An announcement on the pact could come as early as Monday, according to the sources.

The deal, if finalised, would represent a lifeline for Byton, which is struggling to produce its first vehicle after having unveiled its M-Byte concept car several years ago. Foxconn, based in Taiwan, is also talking to other Chinese electric car makers on potential collaborations, another source said.

Foxconn representatives didn’t immediately respond to requests for comment. Byton declined to comment.

Tech companies are increasingly pouring money into developing next-generation cars, including all-electric vehicles and the smart technologies that go with them like autonomous driving and car-to-car communication systems. Foxconn is the single most important production partner for Apple, which is reportedly considering developing a self-driving car of its own. Foxconn is also seeking to diversify a business that depends on the US smartphone giant for half of its revenue.

In early 2020, Hon Hai announced a plan to form a joint venture with Fiat Chrysler to develop and make electric vehicles in China, though it would not be involved in any assembly itself.

In October, the Taiwanese company unveiled its first electric vehicle chassis as well as an open software platform that is aimed at helping EV makers deliver models to the market faster. It will start shipping its first developer kit in April. The Foxconn group has been supplying parts to other major car makers including Tesla.

“The electric vehicle-related business will be very good in the first half of 2021,” Hon Hai chairman, Young Liu, said at a company event in Taipei last month.

Byton, one of the highest-profile Chinese EV start-ups, had a tough 2020. It suspended all domestic operations and furloughed staff in July after the coronavirus pandemic made it tougher to get its business off the ground. Even before Covid-19 the company had encountered difficulties meeting deadlines on producing and delivering its first model. The company’s website still accepts reservations for cars.

Founded by former BMW managers, Byton, initially named Future Mobility Corporation, had about 1,000 employees in China as of June and about 500 elsewhere, including the US. Its investors include state-owned China FAW Group and EV battery maker Contemporary Amperex Technology, which supplies batteries to Tesla.

Byton was planning to enter North America and Europe around mid-2020, former chief executive Daniel Kirchert, also one of the company’s co-founders, said in early 2019. The company would consider an initial public offering after new financing and production begins, he said at the time.

The M-Byte SUV can reach 80 per cent of full charge in about 35 minutes and has a top speed of 190 kilometres an hour. It has a range of up to 550 kilometres, according to specs on Byton’s website.