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(Bloomberg) -- Apple Inc.’s Taiwanese manufacturing partner Foxconn Technology Group is setting up a car venture, strengthening its automotive capabilities at a time when technology companies including its California ally are looking to expand in vehicles.Foxconn is joining forces with Chinese carmaker Zhejiang Geely Holding Group Co. to provide production and consulting services to global automotive enterprises, according to a statement from the companies Wednesday.Amid reports of Apple considering making its own electric vehicles, Foxconn has been bulking up its automotive muscles swiftly. Such moves may help the company become a major contender to make cars for its largest customer.With development work still at an early stage, Apple will take at least half a decade to launch an autonomous electric vehicle, people with knowledge of the efforts have told Bloomberg News. That suggests the company is in no hurry to decide on potential auto-industry partners. Last week, Hyundai Motor Co. backed away from a statement confirming it is in talks with Apple, saying it had been contacted by potential partners for the development of autonomous electric vehicles.Foxconn, whose main listed arm is Hon Hai Precision Industry Co., in October unveiled its first-ever EV chassis and a software platform aimed at helping automakers bring models to the market faster. It plans to deliver its first development kit in April, with Hon Hai Chairman Young Liu saying EV-related business in the first half will be “very good”. Meanwhile, Foxconn’s key unit Foxconn Technology Co. is reportedly expanding a plant to develop automotive metal parts.Earlier this month, Foxconn signed a manufacturing deal with embattled Chinese electric-vehicle startup Byton Ltd. with the aim to start mass production of the Byton M-Byte by the first quarter of 2022.An Apple car would rival electric vehicles from Tesla Inc. and offerings from companies such as upstart Lucid Motors and established manufacturers like Daimler AG and Volkswagen AG. Setting up a car plant can cost billions of dollars and take years, likely the reason why Apple is talking to potential manufacturing partners.Apple has continued to investigate building its self-driving car system for a third-party auto partner rather than its own vehicle, the people familiar have said, and the company could ultimately abandon its own car efforts in favor of this approach.Other technology companies seeking to expand into the autonomous driving space have also sought partnerships. Alphabet Inc.’s self-driving unit Waymo has worked with Chrysler, while Amazon.com Inc. has tapped Rivian Automotive Inc. for cooperation over delivery vans.This week, billionaire Li Shufu’s Geely struck a pact with search-engine giant Baidu Inc. to set up a venture to make intelligent electric vehicles.Li, who is also Daimler’s largest shareholder, has championed partnerships and consolidation as a way for automakers to pool resources for initiatives like self-driving cars and electrification. He’s built a global carmaking empire over the past two decades, securing stakes in European legacy brands such as Lotus as well as investing in Malaysian auto company Proton.(Updates with other partnerships in seventh paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Taiwan Semiconductor Manufacturing Co. reported record quarterly revenue, joining other Apple Inc. suppliers in signaling strong demand for the new 5G iPhones.The world’s largest contract chipmaker said Friday that December sales totaled NT$117.4 billion ($4.2 billion). Revenue in the quarter reached a record NT$361.5 billion, according to Bloomberg News’s calculations based on previously released monthly sales figures. That came in slightly below the average estimate of NT$364 billion, which had risen in past months as expectations around the iPhone grew.Shares of Apple’s main chipmaker have rallied more than 70% over the past 12 months and reached a record high on Friday. The company has predicted that the industry “mega trends” of 5G and high performance computing-related products will continue to drive growth over the long term.“Taiwan Semiconductor Manufacturing Co.’s 4Q revenue could exceed guidance of $12.7 billion on a continuation of strong chip orders from customers such as Apple” and Advanced Micro Devices, Bloomberg Intelligence analyst Charles Shum and Simon Chan wrote in a note Wednesday. Still, a strong Taiwan dollar and higher expenses for advanced 5-nanometer chip production may pressure the chipmaker’s operating margin, they added.Revenue for the entire year came in at NT$1.34 trillion, up roughly 25% from 2019. TSMC is scheduled to report quarterly profit on Jan. 14.Robust demand for the new iPhones have provided a boost to other Apple suppliers. Assembler Hon Hai Precision Industry Co. earlier this week beat quarterly revenue expectations, while British-German chipmaker Dialog Semiconductor Plc increased its sales forecasts due to stronger-than-expected demand for 5G phones and tablets.Read more: IPhone Supply Chain Sends Bullish Signal on 5G After Tepid StartFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Main iPhone assembler Hon Hai Precision Industry Co. reported higher-than-expected quarterly revenue thanks to robust demand for Apple Inc.’s new 5G devices.The Taiwanese company’s sales in December totaled NT$713.8 billion ($25.5 billion). Revenue in the quarter reached a record NT$2 trillion, according to Bloomberg News’s calculations based on previously released monthly sales figures, beating the average estimate of NT$1.8 trillion. Hon Hai rose as much as 4.8% in Taipei Wednesday to its highest in more than two years, after Citigroup raised its earnings estimate and target price on the company.The strong showing from Apple’s most important production partner suggest demand for the U.S. giant’s latest devices may have surpassed initial expectations. The world’s most valuable company outperformed the biggest tech corporations in 2020 on the strength of its 5G iPhones, a crucial indicator of whether consumers will adopt the much faster but pricier technology in 2021.Wall Street has grown increasingly bullish on Apple’s prospects in the coming year with analysts projecting that a recovering economy will fuel even more demand for iPhones, wearables such as Airpods and services. Wedbush analyst Daniel Ives wrote Asia supply-chain checks “have now exceeded even our ‘bull case scenario’ for units in FY21 given the current trajectory, a major positive for shares over the coming months.”Hon Hai is the exclusive assembler of the top-of-the-line iPhone 12 Pro and iPhone 12 Pro Max. Its sales for 2020 came in at NT$5.4 trillion, up slightly from NT$5.34 trillion in 2019 after Covid-era demand for connected gadgets offset a global economic downturn. Chairman Young Liu has said he expects Hon Hai sales to grow by single digits in 2021, while its automotive-related business will be “very good” in the first half.The Taiwanese company’s shares gained more than 13% in the first two trading sessions of the year, propelled further by news it had sealed a manufacturing deal with embattled Chinese electric-vehicle startup Byton Ltd.(Updates with share action from the second paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.