Fiat Chrysler, Foxconn Team Up for Electric Vehicles
16 Januar 2020 - 9:37PM
Dow Jones News
By Nora Naughton and Yoko Kubota
Fiat Chrysler Automobiles NV plans to develop electric vehicles
with contract-electronics giant Foxconn Technology Group, according
to a regulatory filing, as the Italian-American auto maker looks to
make up ground in the market for battery-powered cars.
Foxconn said in a filing in Taiwan on Thursday that it is
establishing a joint venture with Fiat Chrysler to develop and
produce electric vehicles as well as operate internet-connected
vehicles. Foxconn's ownership in the joint venture would be 40% or
less, the Taiwan-based company said.
A Fiat Chrysler spokeswoman at the company's Detroit-area
headquarters declined to comment.
For Foxconn, the move comes as the company seeks to expand
beyond electronics and boost profitability. Formally known as Hon
Hai Precision Industry Co., Foxconn is the main assembler of Apple
Inc.'s iPhones, sales of which have been slowing as customers hold
on to smartphones longer and competition heats up from Chinese
producers offering lower-price handsets.
The tie-up with Foxconn would be one of Fiat Chrysler's most
significant efforts at selling electric vehicles in China, where
global car companies are pouring investment into battery powered
cars to meet government regulations. The company has invested less
in electric-vehicle development than rivals and is confronted with
increasingly strict emissions regulations in China and Europe.
A planned merger with French auto maker PSA Group is aimed in
part at accelerating its development of advanced technologies,
including electrified vehicles.
China has long been a weak spot for Fiat Chrysler, as its global
Jeep brand initially failed to catch on with Chinese consumers. The
company's third-quarter financial results in the Asia market were
dragged down by lower demand in China, the company said.
Foxconn's chairman, Young Liu, said during an investor call in
November that electric vehicles were one area the company was
focusing on for future growth.
At that time, executives said Foxconn wouldn't be building an
entire car but rather would be build a chassis platform for car
makers, using its own modules, without specifying what those
modules are. They also said the company has talked with some car
makers and electric-vehicle startups.
Industrywide vehicle sales in China fell for a second
consecutive year in 2019, with auto industry executives warning of
another tough year ahead in the world's largest car market.
Fiat Chrysler rival General Motors Co. reported its biggest
sales decline in China earlier this month, down 15% last year. GM
is the second-largest auto maker in China by sales behind
Volkswagen AG. Fiat Chrysler doesn't break out its China sales.
Even though Chinese regulations are pressuring car companies to
introduce battery-powered cars, sales of electric vehicles have
been falling, after the bulk of the government's subsidies for
green cars expired. China's electric-vehicle sales fell six
straight months through the end of 2019.
China's government earlier this month signaled it wants to
continue to support electric-vehicle adoption and that subsidies
would remain stable this year.
Write to Yoko Kubota at yoko.kubota@wsj.com
(END) Dow Jones Newswires
January 16, 2020 15:22 ET (20:22 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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