Electric vehicles (EVs) are no longer just the domain of traditional automotive manufacturers. Industry giants like Taiwan-based Foxconn, known for its role as the major supplier for Apple’s iPhones, alongside other technology heavyweights such as Huawei and Xiaomi, are reshaping the competitive scene within this rapidly growing sector.
Recently, at the Consumer Electronics Show held last week in Las Vegas, Foxconn showcased its vision for the future, presenting the Model B, its sleek EV hatchback developed through Foxtron, its joint venture with Taiwan's Yulon Motor Co. Foxconn has ambitious plans to dominate the market, claiming it aims to produce 40 percent of the world's EVs. This goal is bolstered by nearly $1.3 billion of investments over the past decade focused on acquiring companies and technologies related to automotive production, according to research firm Mergermarket.
With Foxconn's pursuit of excellence, the automotive industry's traditional giants are feeling the pressure. Japanese automakers Nissan and Honda have recently announced plans to explore potential mergers, partly propelled by the influx of well-funded competitors. "Foxconn’s entry to EVs mirrors its plug-and-play strategy in electronics, reflecting the growing convergence of electronics and automotive technologies," said Vivian Wong, head of Mergermarket’s M&A Analytics for the Asia-Pacific region.
The stakes are high as new tech players like Huawei Technologies are also ramping up their EV operations. With partnerships established through its Harmony Intelligent Mobility Alliance, Huawei is working with companies like Chery Automobile and Seres Group to secure its position. Meanwhile, the Japanese company Sony is collaborating with Honda to launch the Afeela sedan, marking its entry alongside existing players.
These developments come on the heels of Hyundai’s recent launch of the Ister EV, priced impressively at around $18,000, making it the most affordable electric vehicle in its segment, outstripping even rising Chinese rival BYD’s Dolphin. Such competitive pricing and innovation are expected to stir the market significantly.
While the arrival of tech giants holds great promise for innovation, it also raises considerable challenges. Nissan, which introduced the world’s first mass-market EV, the Leaf, back in 2010, finds itself under pressure to adapt and respond to these fast-moving changes. Jun Seki, Foxconn’s chief strategy officer and former Nissan executive, has reportedly discussed partnership opportunities with Renault, which owns part of Nissan. Yet, Nissan’s CEO Makoto Uchida has clarified, "Foxconn has not directly approached [Nissan] about a merger."
Foxconn’s ventures have not been without setbacks. The company's attempt to manufacture the Endurance EV truck ended abruptly when Lordstown Motors, based at the former General Motors plant, declared bankruptcy earlier this year. Similarly, their partnership with Fisker Inc. culminated with Fisker filing for Chapter 11 bankruptcy in June, raising questions about Foxconn's strategy moving forward. Despite these hurdles, the company is undeterred and continues to feature six EV models on its website including the Model T bus, Model V pickup truck, model N van, and the luxury Model E sedan.
Industry analysts agree the road is likely to be bumpy. Established leaders like Tesla, which produces over half of its total EVs from China, will resiliently defend their market share against new entrants. Conversely, the new players are banking on technology convergence—from smartphones to electric vehicles—to forge their own competitive advantage.
With prices of EVs steadily declining and technological advancements surfacing, the question remains: Can established players like Tesla and BYD maintain their hold against surging tech-driven competitors? The shifting competitive dynamics promise to transform the electric vehicle market, making it one of the most dynamic landscapes for innovation and investment.
The endgame is clear: the EV market will likely witness increasing competition from both traditional automakers and new-tech giants, leading to innovation, aggressive pricing strategies, and potentially shifting consumer preferences. Whether the likes of Foxconn, Huawei, and Hyundai can significantly disrupt the well-entrenched automotive brands remains to be seen, but one thing is certain—this is just the beginning of the new electric vehicle era.