Hon Hai is facing challenges in improving profitability.

Hon Hai, the world’s largest electronics design, development and contract manufacturing (CDMS) company, has suffered from an operating profit margin in the 2% range for the past five years until 2023. As a result, Hon Hai is pushing ahead with measures to make BEV’s CDMS a profit driver. However, two emerging BEV manufacturers, which were commissioned by the company, went bankrupt one after the other at its assembly plant in Ohio, USA.

Furthermore, the company has developed MIH, an open platform for BEV development that forms the basis of CDMS, and is aiming to receive orders from emerging BEV manufacturers and others, but no contracted projects have surfaced other than Project X, an automated commercial BEV that the company is leading.

The success or failure of the CDMS for BEVs is thought to depend on how many contractors can be secured who will stably contract the production of a certain number of vehicles. In order to attract such contractors, it is necessary to create many innovations through MIH, such as attractive features or production technologies that can significantly reduce costs.