Foxconn: will build its first battery factory in Taiwan without worrying about Lixun's entry into the field of electric vehicles

Foxconn said on March 3 that it would produce battery packs and batteries for the first time at its new plant in southern Taiwan to gain more control over the supply of key materials for the electric vehicle industry, according to foreign media reports.

Foxconn also said it planned to build a battery pack, battery and energy storage system factory in Kaohsiung, where it would design and assemble electric buses. "our goal is to build a complete ecosystem for the city's electric buses, and then we can sell electrification solutions to other regions," Liu Yangwei, chairman of Foxconn, said at a news conference. "

At a time when the US, Europe and Japan are eager to strengthen the flexibility of the chip industry chain and supply chain, Foxconn has decided to build battery and energy storage system factories in Taiwan to create a complete ecosystem there. The White House supply chain assessment report pointed out that the battery is one of the most critical components of electric vehicles, and it is of great significance to strengthen the control of battery supply.

Lixun Precision (Luxshare), a rising iPhone assembler, recently announced plans to work with carmaker Chery Group to design and build cars for other companies, with a strategy similar to that of Foxconn. Liu Yangwei said he was not worried about rival Lixun's recent foray into the electric vehicle industry.

"I'm not surprised that we will have more competitors in China, but it's a good sign that people are optimistic about the electric car business," Liu said. "however, over time, you will see a wave of consolidation in the electric vehicle industry, and only competitive companies can survive." He added, "I estimate that by 2025, you will see who wins and who is eliminated."

Liu Yangwei also said that Foxconn began delivering Model T electric buses to bus operators in Taiwan's Kaohsiung city on March 3 and plans to deliver 30 Model T buses by the end of this year, the first delivery since Foxconn identified electric vehicles as an important growth driver in 2019. Liu Yangwei also said that Foxconn is working with Lordstown Motors, a US start-up, to produce electric pickups. He said in January that delivery of pickups made in partnership with Lordstown would begin in the second half of this year.

Foxconn is known for its ability to vertically integrate various components, which not only ensures supply, but also increases its bargaining power in the supply chain. Foxconn had previously announced plans to build its first chip manufacturing plant in India in partnership with Vedanta, the Indian natural resources group. Last summer, Foxconn also acquired a chip factory in the northern city of Hsinchu in Taiwan and set up a chip packaging and testing service center in Qingdao to expand its chip production capacity.

In January, Foxconn also signed a memorandum of understanding with Indonesia's Ministry of Investment, Indonesian battery supplier Industri Baterai Indonesia, energy supplier Indika Energy and electric motorcycle maker Gorogo to create a new energy ecosystem covering energy storage systems, power station changes, and the market for two-and four-wheeled electric vehicles.

Foxconn has been accelerating the pace of investment to expand its influence in the booming electric vehicle industry. Mr Liu promised that Foxconn's designs and components would account for 5 per cent of the global electric car market by 2025, while generating T $1,000bn ($35.6 billion) in revenue by 2026.