Apple supplier Foxconn teams up with Fisker to make electric vehicles

Electric-car maker Fisker Inc said it will work with Apple supplier Foxconn to produce more than 250,000 vehicles a year from late 2023, jumpstarting its shares on Wednesday.

Fisker's shares jumped 23.4% to $20.10 in premarket trading.

The deal, codenamed "Project PEAR" (Personal Electric Automotive Revolution), is looking at markets globally including North America, Europe, China and India, Fisker said.

Foxconn, Apple's main iPhone maker, has ramped up its interest in electric vehicles (EVs) over the past year or so, announcing deals with Chinese electric-car maker Byton and automaker Zhejiang Geely Holding Group.

Foxconn aims to provide components or services to 10% of the world's EVs by 2025-2027, and has been in talks with multiple car manufacturers for future cooperation, Chairman Liu Young-way said in October.

Also read: iPhone assembler Foxconn to help launch electric cars this year

The Taiwan-based company's approach poses a major threat to established automakers that technology companies such as Apple and other non-traditional players could use contract assemblers as a shortcut to competing in the vehicle market.

The EV space has been booming, with Tesla Inc still being the market leader. This week luxury electric-car maker Lucid Motors announced plans to go public by merging with a blank check company, even before regular production of its first model has begun.

The recent run up in valuations of several EV startups, including Nikola Corp and Lordstown Motors Corp , that have yet to produce saleable vehicles or meaningful revenue, has drawn comparisons to the dotcom bubble of 1999-2000, with analysts and investors expecting a near-term correction.

Fisker said in December Canadian auto supplier Magna International Inc would initially manufacture its first vehicle, the Ocean SUV, in Europe. The production is expected to start in the fourth quarter next year. 

Reporting by Akanksha Rana and Tiyashi Datta.