KYOTO, Japan, July 21, 2021 (GLOBE NEWSWIRE) -- Nidec Corporation (TSE: 6594; OTC US: NJDCY) (the “Company” or “Nidec”) today announced that the Company has agreed to start discussions on establishing a joint venture (JV) with Hon Hai Technology Group (TWSE: 2317) (hereinafter referred to as “Hon Hai”) and Foxtron Vehicle Technologies Co., Ltd. (hereinafter referred to as “Foxtron”) of Hon Hai Technology Group in Taiwan.
On March 18, 2021, Nidec signed a memorandum of understanding with Foxtron regarding its strategic alliance in the development of electric vehicle (EV) drive systems. Foxtron and Nidec have continued joint development to supply products equipped with Nidec’s traction motor system E-Axle for customers all over the world. Moving forward to prepare the productions further, Hon Hai/Foxtron and Nidec have come to consider establishing the JV. The JV aims to ensure a stable supply of traction motors and other automobile motors for Hon Hai/Foxtron, and to expand sales opportunity of new markets and customers for Nidec. Also, the Company expects that the JV will greatly contribute to the business expansion and growth of all companies related to the JV.
The three companies’ agreements regarding the JV as of now are as follows;
- Hon Hai/Foxtron and Nidec will conduct feasibility studies and contract negotiations with the aim of concluding a joint venture establishment agreement by the end of December 2021.
- The JV will be headquartered in Taiwan and will be established within 2022. In addition, the main business of the JV will be on the development, production and sales of traction motor systems and various motor-related products for automobiles.
- Other details will be decided in future discussions between the three companies. It may be partially changed by discussion.
It is an important initiative for the Company to start full-scale sales to customers in the automobile markets from different industries. The Company would like to learn Hon Hai’s global supply chain operation and management, as well as the manufacturing and technical strength accumulated in the ICT field in the past few decades; and also learn Foxtron’s know-how cultivated through the development experience of EVs and Open EV Platform. By collaborating with Hon Hai/Foxtron, Nidec would like to further evolve Nidec’s strengths of lightness, thinness, shortness & small and high efficiency. Nidec is confident that the establishment of the JV will be an important step in building the Company’s foundation for traction motor production target of 10 million units in 2030.
Cautionary Statement Concerning Forward-Looking Information
This press release contains forward-looking statements regarding the intent, belief, strategy, plans or expectations of the Nidec Group or other parties. Such forward-looking statements are not guarantees of future performance or events and involve risks and uncertainties. Actual results may differ materially from those described in such forward-looking statements as a result of various factors, including, but not limited to, the risks to successfully integrating the acquired business with the Nidec Group, the anticipated benefits of the planned transaction not being realized, changes in general economic conditions, shifts in technology or user preferences for particular technologies, whether and when required regulatory approvals are obtained, other risks relating to the successful consummation of the planned transaction, and changes in business and regulatory environments. The Nidec Group does not undertake any obligation to update the forward-looking statements contained herein or the reasons why actual results could differ from those projected in the forward-looking statements except as may be required by law.
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