Best known for manufacturing small electronic devices for companies around the world, Foxconn will soon be branching out to assemble automobiles in Ohio. On Wednesday, the Taiwanese Hon Hai Precision Industry Co. (traded as Foxconn) closed on a deal with Lordstown Motors to purchase a 6.2 million-square-foot plant that used to belong to General Motors.
The $230 million deal leaves Foxconn with the facility and 400 Lordstown manufacturing employees it’s supposed to use to assemble the delayed Endurance pickup. Though the long-term plan is to use the plant to become a contract manufacturer akin to Magna Steyr, with an emphasis on all-electric vehicles.
Following several months of news that Apple Inc. was in talks with battery suppliers to set the company up with the necessary hardware and know-how to manufacture electric vehicles, it looks like the iPhone purveyor is back to square one. Reports have emerged claiming the discussions with China’s Contemporary Amperex Technology Co. Limited (CATL) and BYD have stalled.
While the tech giant is said to be keeping a channel open, companies informed Apple over the last two months that they would not be willing to establish teams and U.S. facilities catering exclusively to its needs. While Japan’s Panasonic is still in the mix as a potential partner, it’s looking like the other companies are bowing out. Reasons are said to vary, however, political tensions between the U.S. and China are alleged to be a contributing factor.
The troubled Lordstown Motors has announced it will be selling its Ohio production facility to the Taiwanese Hon Hai Precision Industry, better known as Foxconn. But this is not a case of the prospective automaker offloading its assets so it can pay off its debts in full retreat. Instead, Lordstown has asserted this is a necessary partnership that will help guarantee it can still deliver the all-electric Endurance pickup truck.
Terms stipulate that Lordstown Motors will sell the sprawling factory to Foxconn for about $230 million. Two years ago, the site was purchased from General Motors for a very breezy $20 million after the Detroit-based manufacturer decided to abandon the Chevrolet Cruze. Foxconn will also be buying up $50 million worth of common stock and effectively take responsibility for production at Lordstown Assembly. However there is a laundry list of things that need to be done before pickup assembly is even an option.
Last month, we wrote up the news that Honda will be working on a battery-electric vehicle called the Prologue — not to be mixed up with the Prelude — and the company would work with General Motors, using GM’s Ultium battery packs.
Why would Honda, known especially for engine development, pair with GM?
Faraday Future hasn’t been making many headlines of late. But it remains an active business entity, surprisingly enough. On Thursday, it announced it had selected Velodyne Lidar Inc. as the exclusive supplier for the sensing/mapping hardware that’s going into its flagship FF91 EV.
Faraday’s missteps have been so frequent and gargantuan, that it would be impossible to give the abridged history without still wasting a large portion of your day. We’ll spare you from that and allow interested parties to dig through older articles about factory snafus, secret management structures, faked prototypes, development setbacks, bankruptcy, and more. The only thing you need to remember is that it is genuinely miraculous that FF still exists as a company – almost like it’s a testament to the utter ridiculousness of some tech startups – that continues to believe it will someday manufacture an electric car.
Over the weekend, Hyundai Motor Group addressed rumors that Kia had been in negotiations to build an electric vehicle for Apple. While the scuttlebutt seems to have been true, talks were indeed underway, the automaker confessed that they had ended without an agreement.
It’s known that Apple has been hunting for potential partners after its EV program was placed into an extended stasis and was hoping to gain access to a skateboard-type platform. Hyundai’s E-GMP architecture certainly qualifies, too. But it’s just one of many entities entering the field as most manufacturers strive to build their own.
While partnering with other industries is essential for the automotive sector, the last few years has shown most nameplates cozying up with the dominant tech firms at a breakneck pace. Just this week, we learned that Ford will be equipping future models with the Android operating system (courtesy of Google) and it wasn’t long before that we were discussing BMW’s arrangement to integrate its business with Amazon Could Services. Even Taiwan’s Foxconn has shown itself willing to get involved with China’s Zhejiang Geely Holding Group — which owns Volvo Cars, Geely Automotive, Lynk & Co, Proton, Lotus Cars, London Electric Vehicle Company, and more.
Now, rumors are swirling that Apple is about to make a gigantic investment into Kia Motors after Korean outlet Dong-a Ilbo (The East Asia Daily) reported that the duo had plans to manufacturer vehicles at the automaker’s American facility in Georgia. The paper stated that tech giant was readying an estimated 4 trillion won ($3.6 billion USD) investment in exchange for Kia building 100,000 electric vehicles per year. However, the mere suggestion has already made Kia money by boosting its share price by over 15 percent on Tuesday.
Seen by some as a moral imperative, electrification is swiftly changing the dynamics of the automotive industry. While automakers spend billions of dollars developing EVs and securing the necessary partners, many are becoming dependent on a handful of companies in Asia for the all-important battery cells needed to power the damn things. It’s gotten so serious that the U.S. government has taken an interest following a December 2019 report from the Institute for Defense Analyses that claimed battery manufacturers had taken on an “outsized importance” in the automotive sector.
It also said the United States would be at a distinct disadvantage if there are supply shortages — which is something that has already happened and is presumed to worsen as more electric vehicles flood into the market over the next few years. The automotive industry is pushing hard into electrification as governments around the world attempt to plot out an elaborate plan to supplant the internal combustion vehicle with EVs. But there are concerns that this has stacked the deck for a small number of suppliers from China, South Korea, and Japan.
Maybe a Civic-based Chevrolet Cruze revival isn’t an insane idea after all. On Thursday morning, General Motors and Honda announced the signing of a non-binding memorandum of understanding to pave the way for a North American alliance.
Platform and powertrain sharing in several segments would be part of this strategic tie-up, the automakers claim, leading one to wonder what the future holds for the increasingly cosy longtime rivals.
With practically every automaker on the planet attempting to make the electric vehicle segment work for them as well as Tesla has, they’re stepping all over each other to gain access to the components necessary to build them.
Everything from securing the raw materials for high-density cells to improving relationships with established battery suppliers will be essential for maximizing market share and embarrassing industry rivals like the little bitches they (hopefully) are. This has been especially true of German brands, who are trying to roll with increasingly demanding emission rules in Europe and China while likewise hoping to improve all-electric range and lower EV production costs.
Daimler, which already has supply deals with SK Innovation, LG Chem and Farasis, is seeking to bolster its partnership with China’s Contemporary Amperex Technology Ltd. (CATL) to address some of the challenges listed above. Mercedes-Benz wants to launch its EQS luxury electric sedan using CATL cells in 2021 — ideally with at least 435 miles of range per charge. While Daimler uses Worldwide Harmonized Light Vehicle Test Procedure (WLTP) metrics that typically average lower when assessed by the U.S. regulators, the proposed target remains enviable.
Bavaria-based BMW says it aims to cut roughly 6,000 positions from its lineup on account of coronavirus complications. Times are tough and the manufacturer needs to tighten its belt, just like many of its peers.
The alley-oop that precedes the slam dunking of these jobs into the wastebasket will be tempting retirement packages for those of a certain age. But BMW also said it is interested in offering younger people financial assistance for full-time higher education with a guarantee of a job when they’re done — offering some amount of hope.
Autonomous vehicle technology might not be a sexy topic for [s]many[/s] some, but human-driven vehicles certainly are. One day we’ll gaze at steering wheels in a sterile museum with a mixture of animalistic hunger and soul-crushing depression.
Sure, Ford’s tie-up with Volkswagen includes self-driving technology (sourced from another tie-up, this one with Argo AI), but that’s only part of the agreement. Late last week, the two automakers moved forward on other projects that might be of interest to you.
U.S. self-driving startup Argo AI has completed a deal with Volkswagen AG on self-driving vehicle technology, fulfilling VW’s wishes for a secure and affordable source of gee-whiz gadgetry for future mobility solutions.
The deal, valued at $2.6 billion, will see VW fork over a cool billion while folding its Autonomous Intelligent Driving team into Argo AI’s operations. The automaker’s alliance partner, Ford, pledged $1 billion (over five years) to the startup in 2017, before last year’s tie-up with the German automaker.
Developing a new vehicle platform in-house is an expensive affair, making the cost of producing an electric vehicle from the ground up a heavy weight to place on an automaker’s balance sheet. Margins for such vehicles are currently slim, if not nonexistent. No wonder everyone’s trying to free up cash.
And yet, because the world has decided EVs are the future, automakers can’t be without them. Ford recently partnered with Michigan startup Rivian to source a platform for an upcoming Lincoln crossover, and now Hyundai has followed suit.
Hyundai and Canoo. Best buddies.
Anybody with more than a casual interest in the automotive industry will tell you the relationship between Nissan and Renault is falling apart. Even the alliance’s founder, executive-on-the-run Carlos Ghosn, says it’s on the cusp of going under. But existing employees have tried to be a little more optimistic, acknowledging that the business partnership has become strained while making suggestions to correct its course.
One plan involves pushing more collaborative projects, which is one of the main reasons for forming an industrial alliance. Renault Chairman Jean-Dominique Senard has already said both sides are committed to making the partnership succeed, citing joint projects as a primary focus. Alliance engineers will meet in Japan at the end of January to discuss new development programs — and attempt to revive a few that fell by the wayside.
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