Taiwanese multinational electronics contract manufacturer, Foxconn Technology Group, is in talks to make an investment in embattled Chinese Electric-Vehicle (EV) startup Byton Ltd. As a supplier for Apple Inc., this deal could mark a large bet by the iPhone assembler on the car-making business, according to sources familiar with the matter.
Hon Hai Precision Industry Co., Ltd., trading as Foxconn, plans to invest around $200 million and the companies aim to start mass production of the Byton M-Byte, the concept car which was revealed several years ago, by the first quarter of 2022, one of the people said. An announcement on the pact could come as early as Monday, the people said, declining to be named discussing information that isn’t yet public.
This deal could turn out to be a lifeline for Byton, which is struggling to produce its first vehicle. Foxconn is also talking to other Chinese EV makers on potential collaborations, another person said.
Tech companies are increasingly rushing into investing and developing EVs and the smart technologies that go with them like car-to-car communication systems and autonomous driving. Apple, which is reportedly considering developing a self-driving car of its own, has Foxconn as its single most important production partner, and the Taiwanese company is also seeking to diversify a business that depends on the U.S. smartphone giant for half its revenue.
In early 2020, Hon Hai announced a plan to form a joint venture with Fiat Chrysler Automobiles NV, where Hon Hai and its subsidiaries will hold 50% of the venture and Fiat Chrysler the rest, to develop and make EVs in China, though it won’t be involved in any assembly itself. In October, its first electric-vehicle chassis was unveiled by the Taiwanese company as well as an open software platform that’s aimed at helping EV makers deliver models faster to the market. Its first developer kit will start shipping in April. The Foxconn group has been supplying parts to other major carmakers including U.S. giant Tesla Inc.
“The electric vehicle-related business will be very good in the first half of 2021,” Hon Hai Chairman Young Liu said at a company event in Taipei last month, according to Bloomberg.
Byton suspended all domestic operations and furloughed staff in July after the coronavirus pandemic posed a huge threat for businesses to lift off. That suspension has been extended now until June though even before the pandemic, the company had encountered difficulties meeting announced deadlines on producing its first model.
Former CEO and co-founder of Byton, Daniel Kirchert, revealed that Byton was planning to enter North America and Europe around mid-2020. The company would consider an initial public offering after new financing and production begins, he had said in 2019.
The M-Byte SUV’s features include a top speed of 190 kilometers (118 miles) an hour and it can reach 80% of full charge in about 35 minutes. According to specs on Byton’s website, it has a range of up to 550 kilometers.