Both Foxconn and Geely takes further action
Several media including CNBC reported that Foxconn and Geely creates a joint venture.
Foxconn and Chinese carmaker Geely have created a joint venture. Its aim is to sell manufacturing and services to the global auto industry. The deal marks Foxconn’s continued expansion into the auto sector and reflects Geely’s desire to partner with technology companies.
Foxconn and Geely will provide car production, consulting, intelligent driving systems and other services to global automotive enterprises. Taiwanese firm Foxconn is very famous as the company that assembles Apple’s iPhones. In 2020, it launched a platform to help automobile companies make electric cars.
Who is Foxconn?
According to its homepage, the profile of Foxconn is described in the following way.
Hon Hai Technology Group (Foxconn) is the world’s largest electronics manufacturer. Foxconn is also the leading technological solution provider. Furthermore, it continuously leverages its expertise in software and hardware to integrate its unique manufacturing systems with emerging technologies.
By capitalizing on its expertise in Cloud Computing, Mobile Devices, IoT, Big Data, AI, Smart Networks, and Robotics / Automation, the Group has expanded not only its capabilities into the development of electric vehicles, digital health and robotics, but also three key technologies –AI, semiconductors and new-generation communications technology – which are key to driving its long-term growth strategy and the four core product pillars: Consumer Products, Enterprise Products, Computing Products and Components and Others.
In 2019, Foxconn achieved NT$5.34 trillion (which is almost equal to 173 billion USD) in revenue. The company has received widespread international accolades and recognition since its establishment. In 2019, the company ranked 23rd on the Fortune Global 500 rankings, 25th in the Top 100 Digital Companies, and 143rd in the Forbes ranking of the World’s Best Employers.
Who is Geely?
According to its homepage, the company overview of Geely is described in the following way.
Geely Auto Group is a leading automobile manufacturer based in Hangzhou, China and was founded in 1997 as a subsidiary of Zhejiang Geely Holding Group. Geely Auto Group sells vehicles under the Geely Auto brand and holds a 50% stake in the LYNK & CO brand.
The group employs more than 50,000 people, operates 12 plants, five global R&D centers in Hangzhou, Ningbo, Gothenburg, Coventry and Frankfurt. The Group also boasts five global design studios in Shanghai, Gothenburg, Barcelona, California and Coventry respectively with over 900 members of staff in total.
In 2019, the brands under Geely Auto Group management sold over 1.46 million units, with Geely Auto retaining its position as the best-selling Chinese brand for three consecutive years, Lynk & Co setting a new annual sales record, and a revitalized PROTON returning to second place in its home market of Malaysia.
Who will be the winner in the Chinese EV market?
In the same month, January 2021, we cover the topic between Foxconn and “Chinese version Tesla”, Byton and the companies co-work to manufacture Byton’s 1st model, “M-Byte”.In addition to this, within the week, Geely will partner with Chinese tech giant, Baidu, to make smart electric vehicles.
Foxconn and Geely show their further action within the week. Thus, this new action might be surprising. On the other hand, this speed and collaboration indicates how tough and attractive the automobile sector is. On the negative side, in the “CASE” era, automobile manufacturers invest tremendous money to lead the market through their technology. However, organic growth takes time so that collaboration, partnership and merger & acquisition are necessary to compete.
On the positive side, the automobile sector is one of the largest market around the globe and its size is huge. Global automotive industry revenue in 2017 and 2030 is 5,315 and 8,931 billion US dollars, respectively. The number is so large that we cannot know the exact number. However, we can say that the amount has big potential for other new players and Foxconn is without exception. The one thing we can convince is that competition in the automobile industry gears up.