Foxconn, based in Taiwan, intends to construct artificial intelligence (AI) data factories in collaboration with American chip giant Nvidia. This initiative is part of Foxconn’s strategy to establish a significant global presence in electric car manufacturing.
Foxconn Chairman Young Liu and Nvidia CEO Jensen Huang jointly revealed these plans on Wednesday in Taipei. They emphasized that the new facilities, equipped with Nvidia’s chips and software, will enhance Foxconn’s ability to leverage AI in its electric vehicles (EVs).
Foxconn in Taiwan partners with Nvidia to construct “AI factories.”
Huang said we’re starting a new computing revolution. We’re beginning a fresh approach to software, where computers, not humans, write it. They mentioned that advanced chips will enable large computing systems to create software platforms for the next generation of EVs by learning from everyday interactions.”
Liu mentioned that Foxconn is shifting from being a manufacturing service company to a platform solution company.
In the past three years, Foxconn has demonstrated expertise in producing a wide range of vehicles, including high-end sedans, passenger crossovers, SUVs, compact pick-ups, commercial buses, and commercial vans. Foxconn, famously known for assembling Apple’s iPhones, plans to adopt a similar business model for EVs. They won’t market the vehicles under their brand; instead, they will manufacture them for clients in Taiwan and worldwide.
In 2021, Foxconn introduced three EV models, which included two passenger cars and a bus. They followed up with more models in the following year, and recently, during Foxconn’s tech day on Wednesday, they unveiled two new ones: Model N, a cargo van, and Model B, a compact SUV.
Foxconn initiated its electric buses in the southern Taiwanese city of Kaohsiung last year. They also plan to start deliveries of their first electric car, branded as N7 by Taiwanese automaker Luxgen, on the island in January 2024. Foxconn has ventured into a fiercely competitive industry.
According to the International Energy Agency, global EV sales, which encompass both purely battery-powered vehicles and hybrids, surpassed 10 million units in the previous year, marking a 55% increase from 2021. The agency projects that nearly 14 million electric cars will be sold in 2023.
Foxconn, also known as the Hon Hai Technology Group, is diversifying its business by entering new sectors like EVs, digital health, and robotics.
Analysts consider their move into the EV sector a logical diversification. According to Kylie Huang, a Taipei-based analyst at Daiwa, the smartphone market is already saturated, and growth opportunities are shrinking. If they successfully enter the EV business, they have the potential to become influential in the coming years.
During the tech day last year, Liu informed reporters of the company’s goal to manufacture 5% of the world’s electric cars by 2025. They also aspire to produce approximately 40% to 45% of the global EVs in the long term.
However, Foxconn’s entry into the industry faced challenges. Last year, they acquired a factory in Ohio from Lordstown Motors, a former General Motors small car manufacturing facility. This partnership ended in June, with the American car company filing for bankruptcy protection and initiating a lawsuit against Foxconn.
Lordstown Motors accused Foxconn of “fraud” and claimed that Foxconn didn’t fulfil its investment commitments. In response, Foxconn dismissed the lawsuit as “meritless” and criticized the company for making “false comments and malicious attacks.
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