TAIPEI -- Foxconn on Tuesday announced a joint venture with Stellantis, the world's fourth-largest auto group, to develop software for connected cars.
The Taiwanese iPhone assembler is seeking new revenue streams as the global smartphone market matures, and has made high-tech and connected cars one of its focuses.
Calvin Chih, CEO of FIH Mobile, Foxconn's Android smartphone affiliate, said the new venture will focus on the development of "smart cockpit" technologies including infotainment systems. The key engineering development team will be based in Taipei though there will also be project management teams based in Europe, Chih said, adding that there are already 250 software engineers working on the project.
The 50:50 joint venture, dubbed Mobile Drive, will operate as an automotive supplier, primarily to supply software solutions and related hardware for Stellantis, which owns such brands as Alfa Romeo and Fiat, according to the companies. All products developed by Mobile Drive will be co-owned by the two companies.
"The vehicles of the future will be increasingly software driven and software defined," Foxconn Chairman Young Liu said during the press event. "Mobile Drive will meet and exceed these expectations of consumers with teams of designers and software and hardware engineers."
Carlos Tavares, CEO of Stellantis, said: "Software is a strategic move for our industry, and Stellantis intends to lead with Mobile Drive, a company that will enable the swift development of connectivity features and services that mark the next great evolution of our industry, just as electrification technology has."
Chih said Mobile Drive will focus on infotainment, telematics and cloud service platform development for specific models, not only electric vehicles but also traditional cars. "It is not an open platform concept," he said, adding that it is different from the Foxconn-led software and hardware MIH open platform that is designed to accelerate the design and development of EVs.
FIH Mobile, which counts Xiaomi, Nokia, and previously Huawei, as its customers, shifted its focus and relocated some of its employees to automotive electronics in 2019 as it aggressively sought new growth drivers amid its shrinking Android smartphone business, Nikkei Asia first reported. Part of FIH's new focus has been developing autonomous driving software internally in the past few years, Nikkei learned.
Foxconn has said in early 2020 that it signed a memorandum of understanding for setting up a joint-venture with Fiat Chrysler Automobiles to build cars in China. The partnership, however, was stalled mainly due to FCA's planned merger with PSA Peugeot Citroen. The merger finally materialized this January to create Stellantis, which owns 18 brands and operates in 30 countries.
Foxconn's strategic partnership with Stellantis marks a major milestone for the Taiwanese company. The iPhone assembler's chairman recently said he expects meaningful revenue and profitability contribution from the EV business starting from 2023. The collaboration with Stellantis, which has a commercial presence in 130 markets, will also help Foxconn realize its ambition of controlling up to 10% of the global market for EVs by 2025.
Foxconn hosted the first membership meeting for its MIH Open Platform in March and says it now has more than 1,600 companies on board with the platform.
The iPhone assembler said it aims to help build 150,000 EVs a year from 2023, and increase annual capacity to 300,000 to 500,000 vehicles in the following years.
Foxconn has also announced a series of partnerships including one to help U.S. EV startup Fisker build its first cars before the end of 2023. In addition, it established joint ventures with China's Zhejiang Geely Holding Group and Taiwan's Yulon Motor, respectively, and has offered supply chain management and operation support to embattled Chinese carmaker Byton to get its operations back on track.
Foxconn's liquid crystal diode display affiliate Sharp announced a deal late Monday night with Fisker to help it build automotive screens.