Hon Hai Technology Group (鴻海科技集團) plans to acquire a 50 percent stake in a ZF Friedrichshafen AG car axle system assembly unit as the Taiwanese conglomerate seeks to accelerate its diversification into the top-tier automotive supply chain.
The strategic investment, which could cost up to 560 million euros (US$620 million), would deepen Ho Hai’s partnership with ZF Friedrichshafen, also known as ZF Group, which is the world’s third-largest tier-1 automotive supplier, the tech firm said yesterday.
Hon Hai, also known as Foxconn Technology Group (富士康科技集團) internationally, said the deal is expected to be closed in six to nine months.
Photo courtesy of Hon Hai Precision Industry Co
ZF Chassis Modules GmbH is the world’s biggest car axle maker, commanding a 26 percent share of the world’s car axle market, which was valued at 16 billion euros in 2021.
The company has an enterprise value of about 1 billion euros, and counts Mercedes-Benz Group, BMW AG and Stellantis NV as its top three customers, the companies said in a joint statement.
The partnership would leverage both firm’s capabilities and expand the range of product offerings in both the internal combustion engine and electric vehicle space, the statement said.
“We are also keen to explore more partnership opportunities with the ZF Group in the broader transportation and mobility space,” Hon Hai chairman Young Liu (劉揚偉) said in the statement.
ZF Chassis, serving global premium and volume car manufacturers, is represented at 25 locations worldwide. It has approximately 3,300 employees, of which 100 are in Germany.
The unit’s sales are expected to exceed 4 billion euros this year.
“With Foxconn, we have gained a strong strategic partner with whom we can open up new perspectives and opportunities for the ZF Chassis Modules GmbH,” ZF Group CEO Holger Klein said in the statement.
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