Mitsubishi Electric and Hon Hai to partner on automotive equipment

Mitsubishi Electric and Hon Hai Precision Industry (Foxconn) have signed a final agreement for a strategic alliance to jointly operate Mitsubishi Electric’s automotive equipment business. As part of the deal, Hon Hai’s investment arm, Lin Yin International Investment, will acquire a 50% stake in Mitsubishi Electric Mobility for 115 billion yen. The transaction is expected to be completed by October 2027, subject to regulatory approvals.

The partnership aims to combine Mitsubishi Electric Mobility’s expertise in electric powertrains, software, and control systems with Hon Hai’s manufacturing scale and market speed. The goal is to develop a high-quality, Japan-based electric vehicle (EV) platform to support the growth of next-generation mobility.

For Mitsubishi Electric, the transaction involves a corporate split to transfer automotive rights and obligations to Mitsubishi Electric Mobility. The company expects to record an impairment loss of approximately 100 billion yen in its consolidated financial results for the fiscal year ending March 2027 related to this transfer. The enterprise value of the automotive business subject to the split is estimated at 320 billion yen, with the equity value agreed at 230 billion yen.