Mitsubishi Electric and Taiwan-based Hon Hai formally announced plans to explore a partnership in automotive equipment. The backdrop is the ongoing redefinition of Japan's suppliers, with Hon Hai's potential new market entry through the use of AI and IT being highlighted.
Mitsubishi Electric and Hon Hai Precision Industry formally announced plans to explore a partnership in automotive equipment. The article identifies electrification, software-defined integration and the use of AI as areas for cooperation between the two companies, envisaging collaboration that would complement their track records in automotive quality.
Hon Hai is said to be aiming to strengthen its business by applying its EMS model to the EV sector and using smart manufacturing and AI. The company is seeking to create value beyond contract assembly of complete vehicles, and its intention to incorporate Japan's advanced electrical and control technologies into the MIH platform is suggested.
Mitsubishi Electric has been considering spinning off its automotive equipment business and introducing external capital. One view is that, while advancing production through joint investment with Hon Hai, the company aims to compete with Toyota-affiliated suppliers led by Denso and strengthen its software- and data-related resources.
The article points out that, as Japan's suppliers are redefined, system integration capabilities, in addition to hardware robustness, are likely to become an increasingly important basis of competition. As foreign-capital companies continue to enter the market, the value and role of OEMs may also change.
The focus going forward will be how the proposed partnership areas, including EV adoption, autonomous driving and SDV, will take concrete shape. One view presented is that acquisitions and partnerships by foreign companies and funds will continue to emerge for business divisions with strong technological capabilities but limited ability to remain independent.