Shulou(Shulou.com)11/24 Report--

Beijing, March 6 (Xinhua) Foxconn wants to repeat its success with iPhone in the field of electric vehicles, but first it needs to find the next Apple and move quickly.

At present, Foxconn faces competition in the production of white-label electric vehicles. White-label electric cars refer to cars made by Foxconn but using other company brands. These electric cars can be tailored to customers, whether they are large carmakers, couriers or any other company.

Analysts point out that while Foxconn has brought advantages to the almost lossmaking electric car industry, it needs to win a big contract to prove it can seize the wave of disruption in the auto industry.

Foxconn will release its results on March 15, when it will provide an update on its electric vehicle manufacturing business. "many of our partnerships will be achieved one by one in 2023," Foxconn said in a statement. "demand for electric vehicles is subverting the industry. well-known traditional carmakers have been and are turning to cleaner and smarter travel solutions."

Time is tight. Foxconn's proposition for customers is simple: let's build the next electric car for you. The company is developing a dedicated supply chain, including chips and batteries, and has acquired the former General Motors plant in Lodstown, Ohio. Foxconn has also hired Jun Seki, a former Nissan executive, to lead the electric car business.

Kylie Huang, an analyst at Daiwa Capital Markets, said Foxconn is currently making cars in Ohio and can provide customers with federal government incentives under the inflation reduction Act. This is a selling point because traditional carmakers both produce gasoline-powered cars and plan to build their own electric vehicle capacity.

"if they don't get the contract this year, it will be more difficult next year." Ms Huang said of Foxconn's search for electric vehicle contracts with traditional carmakers. If Foxconn fails to "catch the wave", she points out, Foxconn could be forced to compete with low-end mainland carmakers, which could turn to contract electric vehicles and compete on costs.

Foxconn's Ohio car plant, Canada's top car supplier Magna International, is already making cars for other companies, and mainland Geely has also expressed interest. Guangxi Automotive Group has begun to produce electric cars for Japanese express delivery company Sagawa Jiaban Group.

Foxconn, the Android system in electric vehicles, is counting on its open platform for MIH electric vehicles to win customers. The company calls MIH the "Android system" for electric vehicles and is looking for partners to standardize technology so that variants can be developed quickly and cheaply.

"We want to build an ecosystem like Android so that anyone, such as United, can say,'I want to make cars,'" Xiao Jieri, Foxconn's chief product officer, said during a tour of the Ohio plant. "maybe the top traditional carmakers will sooner or later say, 'Hey, I want to be a product marketing company. Why do I hire so many people?'"

Jerry Xiao, who developed the first Android phone for Google, now believes electric cars are at a similar commercial inflection point.

In the field of electric vehicles, Foxconn is ambitious. Foxconn initially aims to capture 5 per cent of the global electric car market by 2025 and generate the equivalent of $33 billion in revenue from manufacturing electric cars and parts. Foxconn's long-term goal is to produce nearly half of the world's electric cars.

Led by China, sales of electric vehicles have been on the rise. Assuming electric car penetration is about 20 per cent by 2025, Foxconn's 5 per cent market share means about 900000 vehicles, roughly equivalent to the sales of market leader Tesla in 2021.

"in the electric car market, everyone eats what's in the bowl and looks at what's in the pot," says Sam Fiorani, vice president of AutoForecast Solutions, a car research firm that reduces dependence on iPhone.

His company expects Foxconn to produce about 65000 cars in 2025 and 157000 in 2026. "they don't make iPhone here [at US factories]." He said.

Goldman Sachs estimates that the outsourcing of electric vehicles will reach $36 billion in 2025 and $144 billion by 2030, with production of 800,000 vehicles and 3.2 million vehicles respectively.

For Foxconn, the key will be to get its first big customer and stabilize its plant in Ohio. Currently, the plant produces a small number of electric Endurance pick-up trucks for Loddtown Motor Company (Lordstown Motors). Foxconn has a stake in Lodstown Motor. Foxconn also announced plans to build a car for electric car startup Fisker.

Foxconn Chairman Liu Yangwei told reporters last month that he plans to visit U. S. customers, Foxconn factories in Ohio and Mexico in March or April. Foxconn has invested heavily in auto parts in Mexico. "there should be some related signing activities." He said.

Liu Yangwei, Foxconn chairman, is already supplying parts to Tesla and producing camera modules for carmakers and suppliers. Zeng Weimin, a partner at Bain Consulting in Shanghai, said of Foxconn: "their purchase price may be lower than that of anyone else on earth."

In the car industry, where Tesla and other electric carmakers have cut prices, the sales battle has increased the risk. Foxconn's former General Motors plant in Ohio, which Foxconn bought from Lodstown Motors, is one of the world's highest-volume single-line car assembly plants. Without overtime, the factory can produce about 320000 cars a year.

Ian Upton, director of production control at Foxconn's Ohio plant, said Foxconn hopes to produce about 300000 electric vehicles at the plant. "We would be happy to find a customer with an order of about 250000 cars, and then we can fill other production capacity with niche products." That's what he said.

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