After signing a memorandum of understanding (MoU) back in May, Thailand’s PTT and Taiwan’s Foxconn (also known as Hon Hai Precision Industry) have now agreed to create a joint venture company, Bangkok Post reports. The new company will set up an electric vehicle production facility in Thailand’s Eastern Economic Corridor (EEC) reportedly worth between USD1-2 billion (around RM4.18-8.35 billion).

The EV factory established by the national oil and gas conglomerate (PTT) and multinational electronics manufacturer (Foxconn) will provide end-to-end operations covering the design, manufacturing and assembly of EVs, including the production of critical components such as battery platforms, drivetrains, and motors.

Foxconn’s advanced technology will cover a complete hardware and software platform (collectively known as the Mobility in Harmony Open Platform) that significantly reduces development time and the cost of EV manufacturing, while also increasing EV market competitiveness.

The upcoming factory will take approximately two to three years to be set up and will initially start with a manufacturing target of 50,000 cars a year during its first phase. This will gradually extend to 150,000 cars annually in the coming future. The five-to-six-year investment plan will also involve preparing a supply chain management as well as an engineering research and development centre.

No specific models were mentioned, but automotive players in Thailand that wish to assemble EVs will be able to access the entire value chain of services offered by the newly formed joint venture.

On the specifics of the joint venture, the yet-to-be-named company will be established with registered capital valued at 3.22 billion baht (around RM405 million) and is expected to be fully registered by the fourth quarter of this year.

PTT will invest in the new company through its Arun Plus subsidiary while Foxconn will go through its wholly-owned Lin Yin International Investments. The former is said to hold a 60% stake and the former gets the remaining 40%.

“This joint venture will stimulate national investment as well as enhance Thai people’s skills and vocations. Following the success in the first phase, we will expand the investment further,” said Auttapol Rerkpiboon, president and CEO of PTT Public Company Limited (PTT).

“This initiative will not only help increase business potential on the world stage, but also respond to the government policy and direction of promoting electric vehicles, which intend to accelerate the electric vehicle industry to be one of the outstanding S-Curve industries, driving Thailand to further achieve greenhouse gas reduction targets,” he added.

“Our belief in innovation has always been a core value at Hon Hai and it is evident that PTT shares the same DNA as us, truly making them our ideal commercial partners,” commented Young Liu, chairman and CEO of Hon Hai.

“The ASEAN EV market is primed for exponential growth and together with PTT, we are confident that we would be able to create infinite possibilities for Thailand’s new energy vehicle industry. We look forward to this next phase of our partnership with PTT and believe this joint venture will propel us further in the realization of Thailand 4.0,” he continued.