Chinese EV startup brand Byton is reportedly facing bankruptcy proceedings. The news was confirmed by Byton, stating that one of its creditors had filed the request to start the proceedings. The announcement is a setback for the world’s largest electronics contract manufacturer Foxconn, which announced its strategic partnership with Byton in January this year. The partnership aimed to bring Byton’s first product, the M-Byte SUV model, into mass production before the Q1 of 2022. It also fit into Foxconn’s roadmap to hit into the global EV market.
In fact, Foxconn has been heavily involved with Byton from the very outset. As early as 2015, Tencent Holdings, Foxconn and Chinese automaker Harmony New Energy Auto co-founded a joint venture which in turn invested in another startup, Future Mobility Corporation (FMC). Following several internal issues, Foxconn and Tencent left the joint venture, and FMC eventually named its EV brand as Byton.
By 2020, Byton was already in a series of challenges, and China’s state-owned TV channel accused Byton of having consumed 8.4 billion yuan without being able to enter volume production. One key challenge was Byton’s decision to follow Tesla’s footsteps by establishing its own production facilities, which weighed down Byton’s progress.
That was when Foxconn re-entered the picture. Byton was hoping that it would benefit from Foxconn’s reentry, drawing the latter’s experiences in manufacturing and supply chain management. However, the Chinese state-owned corporation, First Automobile Works Group (FAW Group) became heavily involved in the project, reportedly leading to conflicts with Foxconn. Foxconn confirmed that its team had proceeded to leave Byton, and further cooperation would depend on the outcome of Byton’s reorganization.