A deal between a subsidiary of Taiwan-based manufacturing giant Hon Hai Precision Industry Co. and multinational auto manufacturer Stellantis NV to set up a joint venture to produce smart cockpits for electric vehicles is expected to be completed by the end of this year, according to FIH Mobile Ltd.
In a statement released on the Hong Kong Exchange, where shares of the subsidiary are traded, FIH, in which Hon Hai holds a stake of more than 60 percent, said the conditions precedent of the deal, in which both sides will invest US$80 million, have been fulfilled and the completion of the deal, which was announced in May, is expected by Dec. 31.
The conditions precedent include the business restructuring inside FIH, Hon Hai's subsidiary said, adding that the restructuring efforts had secured regulatory approval.
Through the partnership, FIH and Stellantis will set up a joint venture to be named Mobile Drive Netherlands, with both parties each taking a 50-percent stake.
Mobile Drive is aimed at providing smart cockpit solutions for EVs and self-driving vehicles and gaining a foothold in the Internet of Vehicles (IoV) market by offering entertainment, communications, and cloud technology-based applications, according to FIH.
In addition, the joint venture is expected to provide solutions for voice recognition, voice assistants, navigation systems, e-commerce, and e-payment for EV use, FIH said.
In an initial phase, the joint venture will provide smart cockpit solutions for auto models rolled out by Stellantis and supply ODM services to other clients.
In addition to the smart cockpit joint venture, Hon Hai and Stellantis signed a memorandum of understanding on Dec. 7 to set up an auto semiconductor development partnership.
Under the MOU, the two partners will roll out four auto chips for Stellantis and third parties, the aim being to adopt the new chips in 2024.
iPhone assembler Hon Hai, also known as Foxconn on the global market, has intensified its efforts in recent years to carry out the "3 plus 3" initiative, which is intended to diversify the company's product mix and boost profit margins, with EV development being at the core of those efforts.
The "3 plus 3" initiative refers to three emerging industries -- EVs, robotics, and digital health care -- that are being developed through the application of artificial intelligence, semiconductor, and communications technologies.
Hon Hai has its own 8-inch wafer fab, and also acquired a 6-inch wafer fab from Macronix International Co. in August, which is scheduled to start production in the first half of 2022.
According to Stellantis CEO Carlos Tavares, the upcoming four chips to be produced in cooperation with Hon Hai are expected to meet more than 80 percent of the automaker's demands at a time when there is an ongoing global chip supply shortage.
Stellantis, formed this year through a merger between Fiat Chrysler Automobiles of Italy and the French PSA Group, is No. 4 worldwide in terms of auto sales volume and No. 3 in sales value.
The company owns several major auto brands such as Peugeot, Citroen, Fiat, Chrysler, Jeep, Alfa Romeo, and Maserati.
Source: Focus Taiwan News Channel