Saudi Arabia is reportedly in talks with Taiwanese electronics company Foxconn Technology Group – best known as the manufacturer of electronics like the iPhone – to form a joint venture that’ll build electric vehicles (EVs).
Bloomberg reports the joint venture will be called Velocity, according to two undisclosed sources who asked not to be named.
This partnership between the electronics manufacturer and the largest crude oil exporting country in the world is a move that could help accelerate plans to diversify Saudi Arabia’s economy.
The majority stakeholder in the joint venture will reportedly be Saudi Arabia’s Public Investment Fund, which manages around US$500 billion (A$706 billion) of assets according to SWFI.
Foxconn will reportedly provide software, electronics and the electrical architecture for the new EVs and will only be a minority stakeholder in the joint venture, according to one of the unnamed sources.
The arrangement will help Saudi Arabia gain some experience in manufacturing cars, said another.
Velocity is reportedly looking to build EVs on BMW-licensed chassis.
The German automaker has previously licensed older versions of its platforms to other automakers such as Vietnamese startup VinFast, which manufactured its Lux SA2.0 on a previous-generation X5 platform and its Lux A2.0 on the previous 5 Series platform.
Most of Saudi Arabia’s efforts to develop a local car manufacturing industry have fallen flat, but the country has started using different tactics.
In 2018 it invested in US electric vehicle startup Lucid Motors and earlier in 2021 reportedly hired advisors to explore establishing its own domestic electric car maker.
Bloomberg also reports the Saudi Arabian wealth fund is looking to develop a battery manufacturing plant with a target of producing 15GWh of storage capacity annually by 2028.
This facility will reportedly provide batteries for Lucid and other EV automakers.
The Saudi Arabian government is also in talks with several automakers to install manufacturing facilities on its west coast, according to Industry and Mineral Resources Minister Bandar Alkhorayef.
Most recently, Foxconn revealed its two electric cars and one electric bus under its Foxtron Marque.
These vehicles will be made in a joint venture with Yulon, Taiwan’s largest car maker, which already manufactures cars in partnership with Nissan and Dongfeng, as well as its own Luxgen vehicles.
Its Model E sedan has a body that was designed by Pininfarina and a 560kW powertrain underneath, enabling it to do the 100km/h sprint in 2.8 seconds. Range is claimed to be up to 750km.
Foxconn also recently agreed to buy Lordstown Motors’ factory and will produce its electric Endurance pickup truck as part of a US$280 million (A$395 million) deal.