These days, electronics companies dipping their toes into the realm of the automotive industry is not exactly a foreign concept.
While U.S. establishment automakers like Ford (F) struggle to electrify their lineups, Chinese consumer electronics companies like Huawei and Xiaomi have been pumping out models that rival Tesla’s—and stealing away their buyers, too.
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In fact, one of those “swept away” buyers is none other than Ford CEO Jim Farley. He admitted on a podcast earlier this year that when Ford bought and brought Xiaomi’s bestselling SU7 electric sedan over to the U.S. to test, he used it as his daily driver.
“I don’t like talking about the competition so much, but I drive the Xiaomi,” Farley confessed. “We flew one from Shanghai to Chicago, and I’ve been driving it for six months now, and I don’t want to give it up.”
As reports emerge of Nissan and Honda discussing a potential merger, Taiwanese electronics giant Foxconn saw an opportunity.
The Foxtron Model B at the Hon Hai (Foxconn) Tech Day 2024, in Taipei, Taiwan, on October 9, 2024.
Foxconn enters the Nissan conversation amid Honda merger talks.
According to a new report from Taiwan’s state-run Central News Agency, Jun Seki, Foxconn’s electric Chief Strategy Officer (CSO), has landed in France to discuss the potential purchase of a stake in Nissan (NSANY) from Renault.
Seki, a former Nissan executive who worked with the automaker on multiple continents, is said to be in the country to buy at least some of Renault’s holding in Nissan.
As of 2023, Renault remains Nissan’s biggest shareholder, though it reduced its 43.3% voting stake to just 15%. Conversely, Nissan owns a 15% stake in Renault.
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Foxconn wants to make EVs [by themselves.]
The Taiwanese media reports come after sources reported to The Wall Street Journal that Apple’s iPhone contract manufacturer had been actively “discussing acquiring Nissan.”
Foxconn is reportedly looking to acquire some core items in Nissan’s toolbox, particularly its manufacturing, design and engineering operations and know-how.
In a similar fashion to how they make iPhones for Apple, or how Mercedes-Benz employs Austrian-based Magna Steyr to make its G-Wagons, Foxconn wants to make EVs on a contractual basis; with companies placing all the production heavy lifting onto Foxconn in the future.
Currently, Foxconn is “technically” in the EV business. It owns 51% of the Foxtron brand of EVs with Taiwanese auto manufacturer Yulon. The company has previewed several EV concepts but has not yet begun production of one.
Additionally, Foxconn has committed to investing $250 million toward an industrial park in Vietnam focused on making EV components.
The sources who spoke to the Journal noted that Foxconn knows it has specific limitations in automotive design and production, particularly critical areas like chassis and body manufacturing. The electronics giant’s wishlist for acquiring parts from Japanese automakers, they note, includes access to advanced auto manufacturing tech.
Related: Nissan, Honda may have a huge announcement on the way
The Honda-Nissan talks are ongoing.
Foxconn’s reported interest in Nissan comes as the Japanese automaker is reportedly in talks to merge with one of its contemporaries: Honda (HMC) .
According to sources who have spoken to Nikkei, the two Japanese auto giants are in discussions to deepen ties and allow themselves to make it easier to collaborate on technology that would help their respective companies better compete as a domestic rival to Toyota.
Following earlier reports of the talks, Honda’s Executive Vice President Shinji Aoyama told Bloomberg that the company is considering several options, including a merger, capital tie-up, or the establishment of a holding company.
Nissan is in a tough situation at the moment. According to data from Automotive News, Nissan dealers in the United States have had the lowest profitability levels in nearly 15 years, and their market share has been at its lowest in the last five years.
In late November this year, Nissan executives told the Financial Times that it has “12 to 14 months” to survive if nothing materializes.
Foxconn is traded on the Taiwan Stock Exchange under ticker number 2317 and on the London Stock Exchange under ticker HHPD.
The Nissan Motor Company trades on OTC markets in the United States as NSANY and on the Tokyo Stock Exchange under the ticker number 7201.
The Honda Motor Company is listed on the New York Stock Exchange under the ticker HMC.
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