Automotive supplier ZF Friedrichshafen AG and electronics manufacturer Hon Hai Technology Group (Foxconn) have completed the establishment of their joint venture company. Specifically, the 50-50 partnership will focus in the field of passenger car chassis systems.

The new joint venture, called ZF Foxconn Chassis Modules, is a central element in the future strategy of both shareholders.

Complementing Strengths

The two companies aim to reap synergies of their respective strengths with the new joint venture. Particularly, ZF Friedrichshafen AG secures profitable growth, new customer access, and additional fields beyond the growing core market of axle system assembly. On the other hand, Foxconn will open up to new perspectives in the automotive sector.

The joint venture will use core competencies and process expertise from existing business areas and jointly develop them for new markets.

“ZF and Foxconn complement each other perfectly in this joint venture,” affirms Dr. Holger Klein, Chairman of the Board of Management of ZF Friedrichshafen AG. “It uniquely combines engineering competence, agility, know-how, and customer orientation on a global scale. This secures our presence in today’s growth segments and paves the way to engage in future markets. Together, we will meet the needs of existing and new customers in an even more targeted manner and bring innovative technologies to series production.”

Meanwhile, Young Liu, Chairman and CEO of Foxconn, said, “Foxconn’s global network and supply chain management expertise will have a positive impact on the growth strategies of our two companies.”

In addition, Liu said, “(We look forward on the) partnership opportunities in the transportation and mobility sector with ZF Foxconn Chassis Modules.”

Process Optimization

ZF Chief Executive Offier Eike Dorff and Chief Financial Officer Urs Rienhoff  will head the joint venture. Specifically, they will strive to take advantage of expansion opportunities in the global market for axle system assembly.

Moreover, the joint venture aims to achieve the greatest possible adaptation to markets and partners through continuous process optimization. The enterprise value of the ZF division is around €1 billion (around $1.1 billion). ZF Foxconn Chassis Modules GmbH supplies global premium and volume manufacturers and has presence in 25 locations worldwide.

Currently, the company employs approximately 3,800 people, almost 100 of whom are in Germany. The division’s sales for 2023 amounted to roughly €4.3 billion ($4.7 billion).