Foxconn and Mitsubishi Electric have finalised a strategic alliance to jointly operate Mitsubishi Electric Mobility, the Japanese company’s automotive equipment business. Foxconn will acquire a 50% stake for ¥115 billion ($727 million), with completion expected in October 2027, subject to regulatory approvals. The partnership aims to combine Mitsubishi Electric’s expertise in electric powertrains, software and vehicle control with Foxconn’s manufacturing scale to develop next-generation electric vehicle platforms and expand into global markets.
Key Overview
- Deal value: ¥115 billion ($727 million) for a 50% stake.
- Business valuation: ¥320 billion enterprise value and ¥230 billion equity value.
- Expected completion: October 2027, subject to approvals.
- Business revenue: ¥875.6 billion for the year ended March 2026.
- Revenue ambition: ¥1 trillion in the fiscal year starting April 2030.
- Strategic focus: Electric powertrains, software, vehicle control, autonomous driving and EV platforms.
Foxconn and Mitsubishi Electric Finalise Automotive Alliance
Foxconn, formally known as Hon Hai Precision Industry, has agreed to acquire half of Mitsubishi Electric Mobility as the two companies combine their capabilities to develop next-generation automotive technologies.
The agreement, announced on 16 October 2026, follows months of discussions about a potential partnership. The transaction will see Foxconn’s wholly owned investment subsidiary, Lin Yin International Investment, acquire a 50% stake in Mitsubishi Electric Mobility for ¥115 billion (US$727 million).
The deal values the business at ¥320 billion on an enterprise-value basis and ¥230 billion in equity value. Following completion, the two companies will jointly operate the automotive equipment business rather than Mitsubishi Electric retaining it as a fully consolidated subsidiary.
The partnership represents a significant step in Foxconn’s expansion into automotive manufacturing, while giving Mitsubishi Electric a partner to scale its vehicle technology business. The companies have formalised their agreement to jointly operate an automotive equipment business.
Electric Powertrains and Software at the Centre of the Deal
The partnership will combine Mitsubishi Electric Mobility’s expertise in electric powertrains, software and vehicle control with Foxconn’s speed, scale and other strengths in market deployment.
Mitsubishi Electric will contribute technologies used in automotive systems, including electronic control, while Foxconn brings experience in electronics manufacturing and its ambition to expand its role in electric vehicles. The companies intend to develop high-quality EV platforms in Japan and support their wider adoption.
The alliance also builds on earlier plans to create synergies in electrification, autonomous driving and software-defined vehicle technologies. These areas are becoming increasingly important as automakers integrate more software and electronic systems into vehicles.
The companies’ strategy is to use Japanese engineering and manufacturing capabilities alongside Foxconn’s ability to scale production and bring products to market. Their partnership could help expand the business beyond traditional automotive components into broader EV and autonomous-driving platforms.
The development aligns with Foxconn’s wider effort to join forces for global EV push, extending its automotive ambitions beyond its established electronics manufacturing operations.
Mitsubishi Electric Mobility Targets ¥1 Trillion in Revenue
Mitsubishi Electric Mobility’s automotive equipment business generated 875.6 billion yen in revenue for the year ended March 2026, according to figures disclosed for the business. The unit also recorded an operating profit of 54.4 billion yen, representing a 6.2% operating margin.
The companies aim to increase revenue to ¥1 trillion in the fiscal year beginning April 2030. That would represent growth of approximately 22% compared with the ¥820 billion expected for the current fiscal year.
The revenue target reflects the partners’ ambition to expand the business through new technologies, wider market access and the development of EV platforms. However, reaching that target will depend on demand, competition, execution and the pace of automotive electrification.
The financial details were also highlighted in coverage of the US$727 million stake, which describes the transaction as part of Foxconn’s push to scale its automotive components business.
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Mitsubishi Electric Expects ¥100 Billion Impairment Charge
The transaction will have a near-term accounting impact on Mitsubishi Electric. The company expects to record an impairment charge of approximately ¥100 billion in the fiscal year ending March 2027 and plans to update its full-year earnings forecast on 30 October.
The automotive equipment business will cease to be a consolidated subsidiary after the transaction takes effect, becoming an equity-method affiliate. This means Mitsubishi Electric will continue to have a significant ownership interest while sharing control of the business with Foxconn.
The expected impairment charge is an accounting adjustment associated with the transaction and should not automatically be interpreted as a cash payment of the same amount.
The deal is expected to close on 1 October 2027, subject to contractual conditions and the necessary regulatory approvals. Before the transfer, Mitsubishi Electric plans to reorganise the automotive equipment business into Mitsubishi Electric Mobility.
The transaction details and planned ownership structure are also outlined in the automotive-equipment business agreement.
What the Deal Means for the EV Industry
Foxconn’s investment strengthens its position in the automotive supply chain, while Mitsubishi Electric gains a partner to expand the reach of its automotive technologies. The companies expect their collaboration to support the development of next-generation mobility and strengthen Japan’s automotive industrial base.
The partnership could also create opportunities to supply EV platforms to manufacturers beyond Japan. However, the companies have not confirmed specific vehicle programmes, customers or production volumes arising from the alliance.
The agreement is consistent with the broader shift towards partnerships between technology manufacturers and established automotive suppliers as the industry invests in electrification, software and advanced vehicle systems.
Further details about the EV parts business acquisition provide additional context for the transaction’s role in the evolving automotive supply chain.
Outlook
Foxconn’s planned acquisition of a 50% stake in Mitsubishi Electric Mobility brings together manufacturing scale and established automotive technology. The partnership aims to expand EV platforms, strengthen Japanese automotive capabilities and develop opportunities in global markets.
The next major milestone is the expected completion in October 2027, subject to regulatory approvals and other contractual conditions. Progress towards the ¥1 trillion revenue target will offer another measure of whether the alliance can turn its technology and manufacturing strengths into sustained business growth.
Frequently Asked Questions
1. How much is Foxconn paying for the stake?
Foxconn’s investment subsidiary will pay ¥115 billion, equivalent to approximately $727 million, for a 50% stake in Mitsubishi Electric Mobility.
2. What technologies will the companies combine?
The partnership will combine Mitsubishi Electric Mobility’s expertise in electric powertrains, software and vehicle control with Foxconn’s manufacturing scale and market deployment capabilities.
3. When is the transaction expected to close?
Completion is expected on 1 October 2027, subject to the necessary regulatory approvals and contractual conditions.
4. What is the revenue target for Mitsubishi Electric Mobility?
The companies aim to reach ¥1 trillion in revenue in the fiscal year starting April 2030, compared with ¥820 billion expected for the current fiscal year.
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