Text/Di Lin Audit/Zi Yang Correction/Zhi Qiu
Since 2020, many companies have been trying to build cross-border cars, and Apple's supplier "new favorite" Luxshare Precision is no exception.
Luxshare precision hand in hand Chery
On February 15, Xinhua News Agency announced that the company has reached an agreement with Chery Group to jointly form a joint venture company specializing in the research and development and manufacture of new energy vehicles.
In this cooperation, Lixun Precision's controlling shareholder, Lixun Co., Ltd., will invest 10.054 billion yuan to purchase Chery-related equity.
As soon as this announcement came out, it immediately attracted widespread attention inside and outside the industry, and for a time the news that Luxshare Precision also wanted to build a car was very loud.
In this regard, Wang Laichun, founder of Luxun Precision, clarified: Lixun Precision does not manufacture complete vehicles, but cooperates with Chery to develop ODM business, and is determined to become a first-class supplier of the world's leading automakers.
Indeed, compared with the manufacture of complete vehicles, supplying parts or other products to the depot is the most certain thing for Luxun Precision. Chery Group, a traditional automobile manufacturing giant, is better at vehicle manufacturing business.
Therefore, it is not surprising that the joint venture company jointly established by the two parties is led by Chery Group. However, the effect of Luxshare Precision and Chery car manufacturing may take a long time to be displayed.
Apple foundries are keen to build cars
It is worth mentioning that the "fruit chain" company has entered the field of new energy vehicles and also wants to build cars, and it is not only Lixun Precision.
Foxconn, a former major customer of Luxun Precision, had the idea of building a car many years ago, but the progress was not ideal. In recent years, the new energy automobile industry has exploded, and Foxconn's car-making actions have become more frequent.
Moreover, according to the "Finance" reporter, Foxconn also had long-term contact with Chery Group before, but it is a pity that Chery finally chose Luxun Precision.
In addition, in June 2021, Foxconn also announced at the 2021 China Automotive Chongqing Forum that the company has launched the MIH platform and plans to build it into an Android system for the automotive industry.
It can be seen that Foxconn is not limited to the inherent model of vehicle manufacturing and producing "OEM cars" for customers.
It should be noted that in addition to Luxshare Precision and Foxconn, there are many Chinese suppliers in the "fruit chain" company that are seeking cross-border.
For example, Lens Technology announced its entry into the photovoltaic field in 2021; and Changying Precision also issued an announcement on investment in the field of power batteries.
Although the directions of these suppliers are different, the action of cross-border development seems tacit. In fact, it is not difficult to understand, after all, everyone senses the huge risks created by the high dependence on Apple.
OFILM is a lesson from the past
In the first half of 2021, OFILM, the representative company of the former fruit chain, has already sounded the alarm for Chinese suppliers with the tragic facts of "being excluded from Apple's supply chain", the stock price plummeting, and the huge loss of 2.7 billion.
Almost all of the above-mentioned fruit chain companies that try to survive across borders are at risk of being abandoned by Apple, especially Luxshare Precision.
The author understands that Apple has become the largest customer of Luxshare Precision, accounting for 69% of the total revenue of Luxshare Precision in 2020, surpassing well-known fruit chain companies such as Goertek and Lens Technology.
Not only that, in order to meet Apple's production needs, Luxshare Precision invested too much in technology research and development and production equipment, resulting in the company's asset-liability ratio of nearly 60%.
The relationship between Luxshare Precision and Apple has become highly bound, and it can even be said that Luxshare Precision unilaterally relies on Apple.
If Luxshare Precision loses Apple, the consequences are unimaginable, but Apple loses Luxshare Precision, and it only needs to change another supplier to cultivate.
Obviously, Luxshare Precision has been deeply involved in it, and if it does not seek a new way out at this time, I am afraid that it will end up with the same fate as OFILM.
This also proves the importance of CCTV's previous call on Chinese suppliers to get rid of Apple's supply chain dependence.