Taiwanese tech giant Foxconn announced on Friday that it has teamed up with American electric car startup Fisker to set up a factory in the United States, with the goal of producing vehicles by the end of 2023.
The companies said in a joint statement that they have signed framework agreements to jointly develop a “new breakthrough” electric vehicle that would be at the more affordable end of the market.
Foxconn is the world’s largest manufacturer of contract electronics and assembles Apple’s iPhones and gadgets for other major international brands.
However, attempts have also been made to diversify beyond electronics assembly, particularly electric cars, robots, and digital healthcare.
Foxconn announced in January a joint venture with Chinese automaker Zhejiang Geely Holding Group to provide manufacturing and consulting services to automakers.
Chairman Liu Young-way said Foxconn invested around $ 10 billion ($ 355 million) in electric car development in 2020 and expects investments to increase over the next two years.
Fisker is among a multitude of American electronic car startups hoping to one day challenge Tesla’s supremacy.
The partnership with Foxconn would enable Fisker to deliver products “at a price that really opens up electromobility to the mass market,” said chairman and managing director Henrik Fisker.
According to the statement, the starting price for the vehicle is under 30,000 US dollars with a forecast annual volume of more than 250,000 units at multiple locations.
There were no details on what type of electric car the facility would build.
Production in the US is scheduled to begin in the fourth quarter of 2023. The companies stated that they are also investigating locations in other countries for future production.
The cars will be sold under the Fisker brand in global markets such as North America, Europe, China and India, the companies said without disclosing financial details of the investment.
Fisker calls the joint program “Project Pear”, which stands for the personal revolution in electric cars.
The deal comes as automakers suffer from a global semiconductor shortage after the coronavirus pandemic rocketed electronics and computer purchases.
Foxconn chairman Liu said the company could work with suppliers around the world to ensure supplies to the new factory.
“We have world-class supply chains to support the Pear project – specifically to ensure the reliable supply of chipsets and semiconductors,” he said in the statement.
Taiwanese high-tech chip foundries are among the largest and most advanced in the world.
European, Japanese, and American automakers have turned to Taipei during the shortage, but the island’s foundries are already at full capacity.
The island has pledged to ramp up production, but it is feared that a worsening drought will particularly affect the water-intensive semiconductor sector.
