A Byton M-Byte electric sport utility vehicle (SUV) is on display at the CES 2020 event in Las Vegas, Nevada, USA, on Sunday, January 5, 2020.
Bridget Bennett Bloomberg | Getty Images
GUANGZHOU, China – Apple iPhone maker Foxconn has signed an agreement with Chinese electric car maker Byton to help produce its first vehicle.
The move marks a major push by Foxconn in automobile production as it seeks to diversify its business beyond just assembling consumer electrical products.
Foxconn, which trades Hon Hai Precision Industry Co. in Taiwan, saw its shares above 4% on Tuesday, after closing Monday with more than 8% more.
Byton, Foxconn and Nanjing Development Zone signed a strategic cooperation framework agreement on Monday to jointly produce the Byton M-Byte SUV by the first quarter of 2022.
Foxconn will offer its expertise in advanced manufacturing technology, experience in operational management and will share industrial resources, according to a company statement.
The deal could provide a lifeline for Byton, which unveiled M-Byte for the first time in 2018, but has since struggled to step up production. The Chinese company in Nanjing had to suspend production in July and undergo a reorganization after the coronavirus pandemic affected the business.
For Foxconn, the transaction is a way to diversify its business. Last year, Foxconn launched a set of tools that would allow a company to design large parts of an electric car that would be manufactured by the Taiwanese company. These tools include a chassis, as well as vehicle software.
Foxconn has already supplied specific components to automakers, including Tesla.
China’s electric vehicle market continues to grow strongly. Nio, Li Auto and Xpeng electric car establishments have each announced in recent days that deliveries have increased in 2020 to close the year with new monthly highs.