Foxconn, the world's largest electronics manufacturer and service provider, is accelerating its global expansion in the energy storage sector, with its latest focus on India. According to The Economic Times and other Indian media outlets, the government of Tamil Nadu is planning to allocate approximately 200 acres of land to Foxconn for the construction of a Battery Energy Storage System (BESS) facility. Negotiations between the two parties are in the final stages, and Foxconn is highly likely to proceed with the project. The designated site is located near Manalur in the Tiruvallur district, about 50 kilometers from Chennai. If implemented, this would mark Foxconn's second BESS project globally, signifying a strategic pivot from its smartphone business to emerging energy sectors.
Betting on India's Energy Storage Market
Foxconn’s intentions to invest in India’s energy storage market have been apparent for some time. On August 18, reports from the Press Trust of India and other foreign media revealed that Foxconn was planning to establish a battery energy storage business in the country. Chairman Young Liu noted ongoing discussions with relevant Indian authorities to explore potential collaborations, particularly in southern regions such as Tamil Nadu. Earlier, Indian Prime Minister Narendra Modi publicly expressed optimism following his August 14 meeting with Liu, during which they discussed Foxconn's investment plans. Liu also met with several state chief ministers during his visit.
Liu expressed strong confidence in India’s economic growth and Foxconn’s expansion prospects in the country, stating, “After visiting so many states, I feel India is rising. Foxconn wants to be part of this journey, and we will grow alongside India.” Liu further disclosed that Foxconn had already invested over $10 billion in India, with more investments planned for the coming year. The company is currently preparing to establish a BESS division in India.
This move aligns with Foxconn’s broader strategy, as India and Vietnam have long been its key battlegrounds. Foxconn began testing the Indian market as early as 2008, and by late 2022, reports indicated plans to shift $300 billion in production capacity to India within three years, creating 200,000 jobs in the process.
India’s rapidly growing population and economy are driving increased energy demand, making the energy storage market highly promising. The Indian government has introduced a series of policies to promote renewable energy and storage industries, creating a favorable environment for investments by companies like Foxconn.
However, setting up factories in India is not without challenges. Key risks include inadequate infrastructure, an underdeveloped supply chain, and a heavy reliance on imported components, which hinders assembly efficiency. Additionally, India’s unpredictable regulatory environment can be a source of uncertainty for foreign companies. From 2014 to 2021, nearly 2,800 foreign-registered companies ceased operations in India, accounting for one-sixth of the total multinational companies operating in the country.
Labor quality is another concern. For instance, only about 50% of Apple phones assembled in India reportedly pass quality checks, requiring rework. There have even been reports of severe hygiene issues, such as E. coli contamination, in Indian factories, leading to products failing European microbial testing standards. These challenges are exacerbated in the battery energy storage industry, which demands even higher safety standards.
Tesla previously considered investing INR 14.5 billion in a “gigafactory” in India but suspended its plans after CEO Elon Musk canceled a visit to the country in April 2023.
Strengthening Energy Storage Commitments
Since 2024, Foxconn has accelerated its energy storage endeavors. In March, the company announced plans to partner with Aspiring Capital to establish a green energy development fund with a target size of RMB 7 billion. This fund aims to invest in solar, wind, and energy storage industries, targeting 60 billion kWh of green energy capacity.
In July, Foxconn’s parent company, Hon Hai Technology Group, signed a strategic cooperation agreement with the Henan provincial government to establish new business units in Zhengzhou. These units will focus on electric vehicle manufacturing, energy storage batteries, digital health, and robotics, while building a global high-end manufacturing supply chain and an ecosystem for strategic emerging industries in Henan.
Throughout its history, Foxconn has demonstrated a penchant for entering trending sectors. By establishing new companies, acquiring stakes in leading enterprises, and setting up funds, the company is steadily expanding its presence in the renewable energy sector, particularly in energy storage.
However, it is worth noting that despite Foxconn’s active investments in energy storage in recent years, the company has yet to achieve a significant impact in the industry in terms of production capacity, equity investments, or fund establishment.
Source：TrendForce