China’s Geely Group, alongside Taiwanese electronics manufacturer Foxconn, best known for assembling Apple products, announced a new joint venture on Wednesday to provide contract manufacturing to other global carmakers.
Geely and Foxconn will each hold a 50% stake in the new venture, which will also provide consulting services relating to whole vehicles, parts, and electric vehicles (EV) technologies, the companies said in a statement.
For Geely, the new venture will allow it to share its Sustainable Experience Architecture (SEA) EV-focused platform with other brands, according to people familiar with the automotive giant’s plans.
A source who wishes to remain anonymous also said that the move was a bid for Geely to further utilise the full production capabilities for its factories in China, according to a report by Reuters. This is Geely’s second major deal this week alone, following the partnership with Baidu for EV production.
Geely Automobile, the group’s main listed company, sold approximately 1.32 million vehicles in 2020, but its production plants have the capacity to build more than 2 million vehicles a year.
As for Foxconn, this joint venture further solidifies its commitment to become a major EV player, targetting a 10% share of the global EV market as soon as 2025. Recently, the company unveiled its first “open source” EV chassis, where partners can customise it to fit their individual needs.
Last year, Foxconn also signed a partnership with FCA to manufacture EVs for China. The company also currently supplies parts to Tesla. The announcement for this partnership with Geely comes amid rumours of Apple planning to launch its own electric car by 2024, and is currently in talks with multiple carmakers such as Hyundai for contract manufacturing.
Aside from contract manufacturing, the companies also said that the joint venture will help accelerate the entire automotive industry’s adoption of EV technologies. The partnership will see the introduction of an Information and Communication Technology (ICT) division, focused on improving the efficiency of the manufacturing process, as well as other business models based on Connected, Autonomous, Shared, and Electrified (CASE) technologies.