Geely And Foxconn Team Up To Produce EVs For Other Companies

We thought they would be competitors but now we are not so sure…

On October 17, 2020, Foxconn announced it had the intention to become an electric car manufacturing supplier with its MIH Open Platform. On December 12, Geely said it had the same intentions with its SEA (Sustainable Experience Architecture). You would not be wrong to name them as competitors to Magna Steyr until this January 13, when Foxconn and Geely announced a joint venture to supply electric car manufacturing to third parties.

What happened? We cannot answer but have our guesses. At first, the MIH Open Platform and its products would be made with the help of Yulon, a Taiwanese car manufacturer. For it to get started, perhaps the idle capacity of Yulon’s plants would be enough. But why invest in new car plants when so many others could produce more cars?

This is probably where Geely fits. According to Reuters, it can produce 2 million units per year but sold only 1.32 million cars in 2020. In other words, it could have produced and sold 680,000 vehicles more. Tesla struggled to assemble 500,000 EVs in 2020.

According to Hon Hai (Foxconn’s real name) and Geely, they will produce whole cars and also offer “comprehensive customized consulting services” to companies that wish to have the “Information and Communication Technology (ICT) division of labor.” 

The goal of ICT would be to help legacy automakers to “transition to new innovative and efficient manufacturing processes and business models based on CASE (Connected, Autonomous, Shared, and Electrified) technologies.” In other words, to lead these companies into electrification. 

Considering Foxconn already said it would use mega castings in its MIH Open Platform, we do not doubt one of the “efficient manufacturing processes” it will suggest to these carmakers will be something Tesla already applies to the Model Y.

Although Geely is the company with car manufacturing skills and plants to carry on with production in this partnership, it will be Foxconn that will have three of the five executives that will manage the still-unnamed joint venture. Geely will have two executives on the board of directors.

Does it mean that Foxconn will not work with the MIH anymore? Or that Geely will not offer the SEA to other carmakers? We’ll try to discover more about that with each of these companies. If they do, they will be competitors and partners simultaneously to bring the automotive industry to the next level: electrified mobility.

Sources: Foxconn, Geely, and Reuters 

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