Shares of Foxconn’s EV unit slide 9% in market debut By Reuters

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© Reuters. A view of a Foxtron logo on a electric vehicle on display during the company’s annual Tech Day in Taipei, Taiwan, October 18, 2022. REUTERS/Ann Wang/File Photo

TAIPEI (Reuters) – Shares of Foxtron Vehicle Technologies, a unit of iPhone supplier Foxconn, fell as much as 9% in their market debut on Monday, hurt concerns over potential headwinds in the highly competitive electric vehicle market.

In addition to inflation and high interest rates which have raised the cost of buying a car, EV makers are also grappling with supply-chain bottlenecks and pricing pressure from the likes of Tesla (NASDAQ:), which led EV price cuts this year. 

Tesla CEO Elon Musk last month raised concerns about expanding factory capacity until interest rates ease, echoing similar notes of caution from General Motors (NYSE:) and Ford (NYSE:).

“The EV market has been flooded by a red sea of price cuts by major players such as Tesla,” said an analyst at Mega International Securities, who asked not to be named, citing the firm’s policies on commenting publicly on listed companies.

“Foxtron has lost money in 2021 and 2022, and we don’t think it will turn around in the next two years.”.

Young Liu, chairman of both Foxtron and Foxconn, said, however, the company has a clear strategy for growth.

“Foxtron will build its foundation in Taiwan, leveraging our own design and service momentum in EV , as well as Foxconn’s proven business models to guide our entry into the North America, Southeast Asia mainstream markets."

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