Summarize this content to 2000 words in 6 paragraphs in Arabic Stay informed with free updatesSimply sign up to the Electric vehicles myFT Digest — delivered directly to your inbox.Taiwan’s Foxconn is close to securing a contract with Mitsubishi Motors for the production of electric vehicles in a landmark move for the iPhone supplier’s efforts to break into the auto industry.The world’s largest contract electronics manufacturer is set to announce a deal in the coming weeks to manufacture EVs for the Japanese automaker, allowing it to expand its line-up of models at a lower cost, according to two people familiar with the matter. The agreement would be a coup for Foxconn, which has been trying to break into EV production since 2019. Bringing in a contract electronics manufacturer to build its EVs would also mark a major shift for the car industry as it fights back against China’s dominance in software-heavy battery-run cars.Mitsubishi Motors, which has been considering a deal with Foxconn for some time, sees benefits in reducing its development and production costs by partnering with the Taiwanese group and being able to increase its roster of cars for sale, one of the people said. The Japanese carmaker declined to comment on the Foxconn partnership but said it would “continue to explore collaboration opportunities with various partners to achieve sustainable growth”. Foxconn declined to comment on the deal.Teaming up with a well-capitalised company that has roots outside of the car sector is an alternative path for the industry which has so far focused on megamergers, alliances and project partnerships between automakers. The agreement comes on the heels of the collapse of merger talks between Honda and Nissan, Mitsubishi Motors’ second-largest shareholder. The Japanese automotive mega-deal was triggered by Foxconn’s overtures to Nissan’s alliance partner Renault about taking a stake in the embattled Japanese car producer. The deal with Mitsubishi could provide Foxconn another path into an alliance with Nissan, but the outlook remains uncertain with Nissan just appointing a new chief executive to steer the group out of its financial crisis. Foxconn chair Young Liu told investors earlier this month that a collaboration contract with a Japanese automaker was expected to be “signed in one or two months’ time”, but did not name the counterpart at the time. The Taiwanese group, which makes components and assembles electronic devices ranging from smartphones to robots for customers worldwide, has been building an EV contract design and manufacturing services business since 2019 aiming to become the “Android of EVs”. The company’s decades-long experience in managing supply chains and quickly scaling production for new models would allow it to help carmakers cut development time, lower manufacturing costs and bring products to market much faster, Liu has said. Foxconn’s electric buses and passenger cars made for Taiwanese clients have already hit the roads and the company also makes components for a range of European and US carmakers. However its efforts to sign up a leading traditional carmaker has taken longer than initially expected.For Foxconn, the EV business is part of a diversification push to reduce its dependence on the low-margin iPhone assembly operations. It hired Jun Seki, a former Nissan executive, in 2023 as its chief strategy officer for the EV unit.Analysts say that Mitsubishi Motors possesses coveted plug-in hybrid technology, a strong presence in south-east Asia and desirable rugged off-road vehicles. But the company has been behind in its EV efforts and struggles with its small scale, producing 945,000 vehicles in 2024, at a time of huge investment for car manufacturers.
