Taipei, Jan. 18 (CNA) Hon Hai Precision Industry Co., the world's largest contract electronics maker, said that it is planning to enter into a joint venture with Italian-American car maker Fiat Chrysler Automobiles to produce electric cars.
In a statement released Thursday, Hon Hai, also known as Foxconn in the global market, said the partnership will include the development of internet-connected vehicles.
Both aspects of the proposed partnership -- the manufacture of electric cars and the entry into the Internet of Vehicles (IOV) business -- are aimed at tapping into the huge Chinese market initially and into other markets later, Hon Hai said.
The Taiwanese company, which makes iPhones for Apple Inc., said it hopes to bring its expertise in the information and communications sector to the vehicle industry, while upgrading its industrial capability.
The proposal is to set up a 50-50 joint venture with Fiat Chrysler, Hon Hai said, adding that it would give its subsidiaries a 10 percent share of its stake.
Fiat Chrysler, meanwhile, confirmed in a separate statement that it had entered into talks with Hon Hai on the joint venture.
"The proposed cooperation, initially focused on the Chinese market, would enable the parties to bring together the capabilities of two established global leaders across the spectrum of automobile design, engineering and manufacturing and mobile software technology to focus on the growing battery electric vehicle market," Fiat Chrysler said.
The two sides are in the process of signing a preliminary pact that will govern further discussions, with the aim of reaching final binding agreements over the next few months, the auto maker said.
Still, Fiat Chrysler said, there is no assurance that any final binding agreements will be reached or will be reached in the planned timeframe.
As part of Hon Hai's efforts to expand its product portfolio, it entered into a partnership with Japanese system-on-chip producer Socionext Inc. and American video management software developer Network Optix Inc. earlier this month to develop artificial intelligence-based solutions.
At an investor conference last November, Hon Hai Chairman Liu Young-way (劉揚偉) said the company planned to enter the electric car, robot and digital medical care businesses.