Foxconn, the maker of the Apple iPhone is planning to enter the electric vehicle (EV) manufacturing space in India.
The Taiwanese contract manufacturer has been in talks with some state governments to carry out its plans.
Existing projects
It already 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.
It will also team up with the Saudi Public Investment Fund to create a new EV brand called Ceer.
Indian market
India is a large consumer market and its appeal is furthered by favourable demographics, and government initiatives like “Make in India” which 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.
Explicit plans
Foxconn said that India will be part of its plans to provide two-wheeled EV manufacturing services that will cater to the EV two-wheeler market in Southeast Asia.
This is the first instance where it has explicitly spoken about EV manufacturing in India.
Possible strategies
It is still unclear whether it will do contract manufacturing for multiple brands or for a single brand through the JV (joint venture) route.
A source said, “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.”
States under consideration
Officials from four states — Maharashtra, Telangana, Tamil Nadu and Andhra Pradesh — had met top Foxconn executives to discuss EV manufacturing plans.
Foxconn is keen on Maharashtra as a base for EV manufacturing, however “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”.
It is also considering Telangana as it is “the most active state in terms of outreach and incentive”.
Manufacturing model
“Mobility is a new space for Foxconn”, Neil Shah, vice president of research at Counterpoint Research, said.
The company will adopt the “Build-Operate-Localise (BOL) model”.
As part of this model, it will build a vertical platform including manufacturing, hardware, component manufacturing, and battery management.
It will then partner with local firms through its MIH (Mobility in Harmony) platform which is an open EV alliance that promotes collaboration in the mobility industry.
Android of the EV ecosystem
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 had said that they want to become the Android of the EV ecosystem.
