Taipei, July 18 (CNA) Taiwan-based manufacturing giant Hon Hai Precision Industry Co. has invested NT$15 billion (US$484 million) to set up a subsidiary in Singapore that an industry source close to the investment said is aimed at electric vehicle development.

Photo source:  Hon Hai

In a statement posted on the Taiwan Stock Exchange (TWSE), where Hon Hai shares are traded, the iPhone assembler, better known as Foxconn globally, said it has invested NT$15 billion to establish Foxconn EV Singapore Holdings Pte as a long-term investment.

Hon Hai did not elaborate on the nature of the Singapore investment in the statement, but the source said it is expected to use the new subsidiary as a hub for allocating funds to finance its EV ambitions worldwide.

The company has said that because localized manufacturing is key to EV development, it needs to take advantage of every opportunity to make vehicles in key markets if it wants to meet its goal of carving out at least a 5 percent share of the global EV market by 2025.

Currently, Hon Hai has several EV investment projects in Asia, including joint venture Horizon Plus Co. in Thailand to produce EVs and a subsidiary in Vietnam to roll out EV components and machinery.

Outside Asia, Hon Hai paid US$230 million to buy an Ohio factory from American electric pick-up truck maker Lordstown in May 2022, making Ohio its first EV manufacturing base hub in the United States.

Hon Hai also struck a deal with Lordstown to take a stake in the U.S. company. But Lordstown filed for bankruptcy in June and put itself up for sale after failing to resolve an investment dispute with Hon Hai, its largest shareholder.

Lordstown simultaneously sued Hon Hai for breach of contract and fraud, alleging that Foxconn promised support in order to secure the company's plant and poach its skilled workers, and then subsequently refused to honor its obligations. Hon Hai has denied the accusations.