🚌 A major turning point has arrived for Japan's bus electrification efforts.
Mitsubishi Fuso Truck and Bus Corporation and Taiwan's Hon Hai Precision Industry (Foxconn) have officially agreed to establish a joint venture for EV bus operations in Japan.
This marks the first collaboration between Foxconn—the world-renowned iPhone manufacturer—and a Japanese commercial vehicle maker. Together, they're taking on China's BYD, which currently dominates approximately 60% of Japan's EV bus market.
The New Company: Equal Partnership Launching in Late 2026
On January 22, 2025, Mitsubishi Fuso and Hon Hai held a press conference in Kawasaki, announcing their agreement to establish a new company focusing on EV bus development, production, and sales.
The joint venture is scheduled for establishment in the second half of 2026, with both companies holding equal 50% stakes. Katsuhito Takara, Mitsubishi Fuso's Bus Business Division Head, will serve as President and CEO, while Jun Seki, Chief Strategy Officer overseeing Foxconn's EV business, is being considered for the Chairman position.
Mitsubishi Fuso President Karl Deppen stated at the conference, "We will develop more powerful, competitive bus technology that can respond to the future."
Production Plans: Manufacturing Foxconn Models at the Toyama Factory
The new company will utilize Mitsubishi Fuso Bus Manufacturing Co., Ltd.'s factory in Toyama City, a subsidiary of Mitsubishi Fuso, for EV bus production.
Vehicles will be developed based on Foxconn Group's large EV bus "Model T" and small EV bus "Model U." Model U measures approximately 7 meters in length and 2 meters in width—nearly identical to Hino Motors' compact bus "Poncho." It's designed to meet demand for urban community buses.
The company aims to begin receiving orders for large route buses during 2027, initially prioritizing the domestic market before considering international expansion.
Why Partner with Foxconn: Overcoming Development Cost Barriers
Bus electrification faces significantly higher development costs compared to passenger vehicles. Large EV buses that transport many passengers over long distances require exceptional energy efficiency and safety standards. Increased battery capacity inevitably leads to higher vehicle weight and pricing.
For reference, Isuzu Motors' large EV bus costs approximately 70 million yen per unit—roughly double the price of diesel-powered alternatives.
With the overall bus market in decline, developing these vehicles single-handedly proved unrealistic for Mitsubishi Fuso. Company sources noted that "it's not possible for one company alone to handle development and investment," leading them to leverage Foxconn's EV technology and substantial financial resources.
Foxconn's EV Strategy: A B2B-Focused Contract Manufacturing Model
Foxconn announced its entry into the EV business in 2019, pursuing expansion through a business model centered on vehicle design and manufacturing services for other companies.
Jun Seki, who leads Foxconn's EV operations (formerly Nissan Motor Vice COO and Nidec President), has clearly stated the company's approach: "We have absolutely no intention of doing B2C—we stick strictly to B2B." Foxconn doesn't sell vehicles under its own brand; instead, products reach the market under partner company brands.
In Taiwan, Foxconn has been supplying EV buses to the market since 2022 through Foxtron, a joint venture with Yulon Motor. The Foxconn-led EV development consortium "MIH" includes over 2,700 participating companies, including 100 from Japan.
This partnership with Mitsubishi Fuso represents Foxconn's second collaboration with Japanese companies, following Mitsubishi Motors, and marks the company's first EV manufacturing base in Japan.
Market Context: BYD Commands 60% of Japan's EV Bus Market
China's BYD has established overwhelming dominance in Japan's EV bus market. Having entered Japan in 2015, BYD had delivered a cumulative 503 buses by the end of fiscal 2025, capturing approximately 60% of the domestic EV bus market.
BYD completed its full lineup of route buses in 2025 with the addition of the medium-sized "J7" to its existing large "K8" and small "J6" models. Their pricing remains competitive, with the J7's suggested retail price set at 36.5 million yen.
Japan's electric bus market was valued at approximately $1 billion in 2024, with projections suggesting growth at an annual rate of 14.7% to reach approximately $4 billion by 2033. Under the government's goal of achieving carbon neutrality by 2050, demand for public transportation electrification is expected to continue rising.
Strategic Significance: Geopolitical Risk and Supply Chain Diversification
The Mitsubishi Fuso-Foxconn partnership carries strategic significance beyond market competition.
Concerns about over-reliance on Chinese EVs have been growing across various countries in recent years. Collaboration with Taiwan-based Foxconn attracts attention from the perspective of supply chain diversification.
Additionally, Mitsubishi Fuso is currently proceeding with a business integration with Hino Motors, and this Foxconn partnership relates to that process. Hino Motors jointly operates "J-Bus" with Isuzu Motors, but antitrust considerations make direct collaboration between Mitsubishi Fuso and J-Bus problematic. The Foxconn partnership emerged as an option to accelerate EV development while avoiding these constraints.
Future Outlook: Toward Order Acceptance in 2027
The new company aims to develop next-generation buses capable of not only electrification but also autonomous driving. Business expansion targeting global markets is also planned.
For Foxconn, achievements in commercial vehicles could serve as a stepping stone toward expanding collaboration with Japanese passenger vehicle manufacturers. The company has also announced EV supply agreements with Mitsubishi Motors, steadily increasing its presence in the Japanese market.
Japan's bus industry faces numerous challenges, including driver shortages and difficulty maintaining routes. EV bus adoption could contribute to sustainable public transportation through reduced operating costs, beyond just environmental benefits.
How the Mitsubishi Fuso-Foxconn joint venture will change the BYD-dominated market structure remains to be seen. All eyes are on developments leading up to full-scale operations in 2027.
How far has public transportation electrification progressed in your country? What initiatives exist for bus electrification? We'd love to hear from you!
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Reactions in Japan
I think Mitsubishi Fuso partnering with Foxconn is a realistic decision. Given EV bus development costs, going it alone wasn't feasible. With the Hino integration happening too, this might be the best decision given limited options.
I worked at a rural bus company, and EV bus costs are a real barrier. If it's cheaper than BYD with good quality, more options are welcome. But ultimately, it all comes down to price.
BYD's 60% share is abnormal to begin with. This is the result of Japanese manufacturers completely falling behind on EV buses. The question remains - is depending on Foxconn really okay?
Great news that the local factory will be utilized. Jobs will be maintained, and if a new industry takes root, it's good for the regional economy. Looking forward to saying we make EV buses here.
So Jun Seki is a candidate for chairman. Interesting development to see someone who's moved from Nissan to Nidec to Foxconn involved in Japan's bus business. Hope he disrupts industry conventions.
I always thought Foxtron's Model T and Model U had decent designs. If they come out under the Mitsubishi Fuso brand, after-sales service should be reliable. Can't wait to see the real thing.
Essentially, Japanese manufacturers can no longer make EVs on their own, right? Get Foxconn to build them and just slap on the brand. Is this the future of Japan's auto industry?
EV trucks are probably next after EV buses. BYD has announced truck market entry too, and if the Foxconn-Mitsubishi Fuso alliance expands to trucks, the logistics industry could change dramatically.
As a local government, we want to promote EV bus adoption, but honestly having only BYD as an option was concerning. More domestic production options will make bidding decisions easier.
Foxconn's MIH platform has over 2,700 participating companies, including 100 from Japan. The Mitsubishi Fuso partnership could rapidly boost MIH's presence in Japan.
More EV bus options are welcome. But what matters is whether adoption actually progresses. Rural bus companies can't afford 70 million yen EV buses. The key is how low they can bring the price.
Partnering with a Taiwanese manufacturer makes sense for reducing China dependency risk. However, we shouldn't forget that Taiwan Strait tensions pose different risks.
With driver shortages making route maintenance difficult, we don't have room to think about EV bus adoption. Even with subsidies, we can't decide without seeing total costs including charging infrastructure.
Our company participates in MIH, but few projects actually lead to mass production. If this Mitsubishi Fuso joint venture gets things moving, it could be a parts supply opportunity.
So the company that makes iPhones is now making buses. Appliances, phones, EVs - seems like we can't stop the trend of Japanese manufacturers losing ground. It's a bit sad.
As a Taiwanese person, I'm proud that Foxconn is entering Japan's commercial vehicle market. Just a bit worried this could become an excuse to escalate Taiwan Strait tensions. Business should be kept separate from politics.
Electric school bus adoption is progressing in the US, but pricing is a barrier. If Foxconn succeeds in cost reduction, they could expand globally. Looking forward to it.
BYD buses are increasing in Germany too, but quality issues are sometimes reported. Combining Japanese quality with Foxconn's technology could be competitive in Europe as well.
From a Chinese perspective, this seems a bit late as a counter to BYD. By 2027, Chinese manufacturers will have evolved further. It might be difficult to reclaim market share.
Hyundai is deploying EV buses in Korea too, but struggling in the Japanese market. The Mitsubishi Fuso-Foxconn partnership will likely further narrow opportunities for Korean manufacturers.
London bus electrification is underway in the UK. It's interesting that Japan depends on China for EV buses. I suppose even developed nations can't resist the electrification wave.
Demand for electric buses is growing in Mexico too. If Foxconn expands to Latin America, we'd have options besides BYD. Japanese brands have a good reputation here.
In Poland, there's movement to strengthen EU regulations due to concerns about Chinese buses. Partnering with a Taiwanese manufacturer might be a good strategy to avoid such regulatory risks.
As an Australian transport official, this is of interest. We trust Japanese product quality, but adoption is difficult without price competitiveness. Watching to see how it compares to BYD pricing.
Electric public buses are still upcoming in Vietnam, but many bus systems were developed with Japanese ODA. EV buses from Japanese manufacturers might be easier to adopt.
France has domestic EV bus manufacturers, but they're being pressured by Chinese products on cost. If the Japan-Taiwan partnership model succeeds, European manufacturers should take note.
EV bus adoption is being considered for environmental measures in the Middle East too. I'm interested to see if the combination of Japanese technology and Taiwanese manufacturing can handle harsh desert conditions.
BYD buses are rapidly increasing in Brazil, but there are complaints about support systems. The Mitsubishi Fuso brand has a dealer network, so they could differentiate on after-sales service.
EV bus operation in extreme cold is a challenge in Canada. Battery performance degrades in cold weather - interested to see how Japanese manufacturers address this. Hoping for technical solutions.
Electric bus adoption is progressing in India too, but most are domestic or Chinese. If Japanese EV buses can be price competitive, there could be potential in the Indian market.