Apple’s carmaker partner could be Foxconn-Byton, analyst suggests

Electric vehicle startup Byton's production line could be part of Apple's future as a carmaker. Byton recently entered an agreement with Foxconn, a major Apple partner, a hint into a future possible Apple car manufacturing partnership. (Byton)

Apple’s reported plans for creating a self-driving car by 2024 built using proprietary battery technology left many analysts scratching their heads when it first surfaced in late December.

After those reports, experts wondered what parts of a car Apple would provide beyond a battery and LiDAR technology. Maybe artificial intelligence for self-driving along with sensors, networking and other components for car situational awareness?

RELATED: Apple wants to make cars by 2024 (Really?)

Free Daily Newsletter

Interesting read? Subscribe to FierceElectronics!

The electronics industry remains in flux as constant innovation fuels market trends. FierceElectronics subscribers rely on our suite of newsletters as their must-read source for the latest news, developments and predictions impacting their world. Sign up today to get electronics news and updates delivered to your inbox and read on the go.

Certainly, some said, Apple would not be assembling cars itself and would need partners for many of the components, even though electric vehicles (EVs) do not require as many components as cars with combustion engines. Probably, Apple branding and marketing would be behind whatever final product is produced.

Analysts have been willing to give Apple credit for even wanting to produce a car to compete with Tesla and others, even though the idea is ambitious, to say the least. But when it comes to Apple, it is fair to say, investors do not ever want to sell the company short.

Now there is a hint in the air about who might be a major partner for Apple on producing a car-- Foxconn, its Taiwan-based manufacturing partner that assembles Apple iPhones.  Here is how the reasoning goes:On Monday, Foxconn signed a strategic cooperation agreement with Byton, a Chinese EV startup, and the Nanjing Development Zone to jointly accelerate mass production of the Byton M-Byte SUV by the first quarter of 2022, according to a statement from Byton. 

Byton M-byte suv

“We are pleased to work with Byton to advance the production of the M-Byte,” said Young Liu, chairman of Foxconn Technology Group. “This will allow us to contribute toward the further growth of the EV industry, a demonstration of our commitment in the transformation of the traditional automotive industry.” He added that the partnership with Byton “symbolizes the infinite possibilities created by Foxconn’s industrial advancement and emerging technologies.”

 According to a Bloomberg source, Foxconn is investing about $200 million in the venture.

Foxconn shares, traded as Hon Hai Precision Industry Co., jumped 4% after the partnership news first broke. Under the deal, Foxconn will supply Byton with advanced manufacturing technology, operation management expertise and supply chain resources.   Bloomberg found a source that said Foxconn is also talking to other Chinese EV manufacturers on possible collaborations.

A key insight into Foxconn’s possible connection to Apple on a car is that Foxconn is the biggest production partner for Apple. Also, about half of all of Foxconn’s revenues come from the Apple partnership. The companies are already clearly close, and the Foxconn-Byton collaboration could be extended to Apple.

The Byton-Foxconn deal offers a “clue as to Apple’s manufacturing partner for its car,” said Kevin Anderson, a long-time analyst on auto electronics at Write-Tek.

Apple apparently has the long view on building a car, having started its Project Titan in the auto space in 2014.  But Anderson has noted that building and producing a car in volumes of 100,000 models a year will be daunting, requiring Apple to partner up, possibly with many partners.

“Building a car is a huge logistical challenge so having a manufacturing partner makes the most sense,” Anderson said recently, “I don’t think a full autonomous car [from Apple] by 2024 is feasible but adding 5G vehicle-to-everything (V2X) capability would be in Apple’s wheelhouse and could show the way for future major improvements.”

Anderson added, “the same is true with LiDAR. Everyone wants a much cheaper automotive LiDAR solution in solid state technology but Apple may be in a better position to accelerate the development due to their existing vendor relationships.”

Obviously, the new collaboration between Foxconn and Byton offers just a hint of what might be coming. Foxconn, Apple and Byton have not commented on the idea of Byton and Foxconn working with Apple.