Fiat Chrysler and Foxconn plan push into Chinese e-car market

Fiat Chrysler and Foxconn plan push into Chinese e-car market

Fiat Chrysler and Foxconn plan push into Chinese e-car market

Companies like General Motors Co. and Toyota Motor Co. have entered into electric vehicle joint ventures with Chinese partners to leverage their experience in manufacturing low-priced vehicles.

Italian American automaker Fiat Chrysler is looking to bolster its presence in China and plans to build electric vehicles for the world's biggest auto market in a new joint venture.

The venture, in which Hon Hai would hold at most a 40 percent stake, would combine the innovative spirit and strengths of both companies, while focusing on businesses that apply the Internet of Things to the automotive industry, Hon Hai said.

FCA confirmed on Friday it was in talks with Hon Hai on the potential creation of a 50-50 joint venture to develop new generation battery electric vehicles and engage in the IoV, or "Internet of Vehicles", business, with an initial focus on the Chinese market.

FCA, which is set to launch its first full-electric model, the 500 small vehicle, this year - last month reached a binding agreement for a $50 billion tie-up with France's PSA to create the world's No. 4 carmaker.

China expert and chief executive officer of consultant ZoZo Go says that while Hon Hai has limited experience in the automotive field, it can be of great help to FCA.

Young Liu, Foxconn's chairman, told the financial publication Foxconn "will be responsible for design, components and supply chain management".

"As autos get more and more electrified and more and more digital components replace mechanical ones - especially with EVs but also just traditional vehicles - there's scope for a real opportunity here", said Matthew Kanterman, an analyst with Bloomberg Intelligence.

"The proposed collaboration ... would allow the parties to bring engineering, manufacturing and mobile software technology together to focus on the growing battery electric vehicle market", said a Fiat Chrysler statement.

Talks were aimed at reaching a binding agreement "in the next few months, " the company said.

From Fiat Chrysler's perspective, the automaker has struggled to crack the Chinese market for years, and tightening fuel-economy standards and electric-vehicle mandates make the task even more challenging. A Fiat Chrysler declined to comment beyond the filing.

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