Will you buy an electric car from a smart phone manufacturer? Foxconn, well known for manufacturing Apple iPhones is expanding to a new area.The electronics manufacturer announced that it would build an electric car, and that it would sell for less than USD15,000. It’s now following that declaration with action, specifically a 5-Billion yuan (USD811 Million) investment in a potential factory in China’s Shanxi province.
Foxconn is reportedly looking to expand its business beyond contract manufacturing for Apple and other companies like Microsoft, Sony, and Amazon.com. The Taiwanese company has some experience in the automotive industry. It already manufactures a 25.6-kilowatt-hour lithium-ion battery pack for the BAIC E150 EV, a Chinese electric car that starts at around USD20,300.
Foxconn isn’t discussing anything else about its electric-car production plans, but it may be planning to take advantage of strong Chinese government support for electric cars and a potentially untapped market. The country’s central government has been trying to encourage the adoption of low-emission “new energy vehicles”–including battery-electric, plug-in hybrid, and hydrogen fuel-cell cars–for some time.
Its goal is to curtail rampant air pollution and decrease oil imports. On top of existing subsidies, the government has approved even more incentives for certain electric cars, mostly from local manufacturers. For the most part, these incentives have been met with buyer indifference. Yet carmakers believe China will eventually become a major market for plug-in cars. Both BMW and Tesla believe that China will become the largest market for their electric cars. Tesla is already working on a network of charging stations, and has discussed plans to build cars in China to avoid steep import duties.
