Apple supplier Foxconn to build ‘AI factories’ using Nvidia’s chips and software for a range of applications including self-driving cars

Foxconn and Nvidia plan to build ‘AI factories’ globally, creating a new type of manufacturing anchored on artificial intelligence
Taiwan’s Foxconn wants to replicate its level of success in assembling Apple’s iPhones, as it expands into making electric vehicles for other firms

Foxconn

Reuters

Published: 3:47pm, 18 Oct 2023

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Taiwan’s Foxconn Technology Group, the world’s largest electronics contract manufacturer, will build a new kind of data centre using Nvidia Corp’s chips and software for a range of applications including self-driving cars, the two companies said on Wednesday.

Sharing a stage at the Taiwanese firm’s annual tech showcase in Taipei, Foxconn chairman Liu Young-way and Nvidia chief executive Jensen Huang said their companies were building these so-called artificial intelligence (AI) factories together.

“A new type of manufacturing has emerged – the production of intelligence. And the data centres that produce it are AI factories,” Huang said, adding that Foxconn had the expertise and scale to build them globally.

Showing a hand-drawn sketch, Huang explained how these “AI factories” could be applied to a fleet of autonomous vehicles.

A man inspects the Foxtron Model B electric vehicle, part of a range of EVs made by Foxconn Technology Group, on display during Hon Hai Technology Day in Taipei on October 18, 2023. Photo: EPA-EFE

“This car would of course go through life experience and collect more data. The data would go to the AI factory,” the Taiwan-born Huang said. “The AI factory would improve the software and update the entire AI fleet. In the future, every company, every industry, will have AI factories.”

Nvidia, the world’s most valuable semiconductor company, said in a statement the AI factories would be based on its accelerated computing platform, including its next-generation GH200 superchip that is barred from being sold to mainland China.

The announcement comes after Nvidia on Tuesday said new US export restrictions would block sales of two less powerful, high-end AI semiconductors that it created for the Chinese market, along with one of its top-of-the-line gaming chips.

Nvidia’s shares have tripled in 2023, giving the company a market value of more than US$1 trillion, driven by excitement over the central role of the company’s chips in AI applications.

Details of Nvidia Corp’s HGX AI supercomputing platform – purpose-built for artificial intelligence, simulation and data analytics – on display at Foxconn Technology Group’s annual Hon Hai Technology Day in Taipei on October 18, 2023. Photo: EPA-EFE

Apple supplier Foxconn, formally known as Hon Hai Precision Industry, wants to replicate its level of success in assembling smartphones and personal computers, as it expands into making electric vehicles (EVs) for other companies.

In January, Foxconn and Nvidia announced a partnership to develop autonomous vehicle platforms, in which the Taiwanese contractor would manufacture electronic control units for cars based on Nvidia’s DRIVE Orin system-on-a-chip to sell to the global market.

Liu, standing next to Huang, said Foxconn is “trying to convert itself from a manufacturing service company to a platform solution company”, citing smart cities and smart manufacturing as other applications for AI factories.

Foxconn on Wednesday unveiled a new electric cargo van called Model N, the sixth prototype in its EV push that has set ambitious goals but has so far only seen limited orders.

Foxconn Technology Group unveils its Model N electric cargo vehicle during the company’s Hon Hai Technology Day in Taipei on October 18, 2023. Photo: Agence France-Presse

Jun Seki, head of Foxconn’s EV business, said the company was talking to 14 potential customers, without naming them, and sees India and Japan as promising countries for EV development.

Initially targeting 5 per cent of the global EV market and the equivalent of US$33 billion in revenue from manufacturing EVs and components by 2025, Foxconn’s aggressive longer-term ambition is to make nearly half the world’s EVs.

Foxconn’s Hon Hai Technology Day takes place on the birthday of its billionaire founder Terry Gou Tai-ming, who stepped down as the company’s chairman in June 2019.

He is now running as an independent candidate for Taiwan’s president at elections in January and did not appear at the event, unlike last year when he drove on stage in a prototype EV.

Foxconn’s shares closed down 0.9 per cent on Wednesday, compared with a 1.2 per cent fall on the broader market.