#Taiwan #Taipei #Foxconn #AI Data Center #TECO Electric

TECO and Foxconn Join Forces in AI Data Center Initiative

In a significant development within the technology and manufacturing sectors, TECO Electric & Machinery Co., Ltd. and Hon Hai Technology Group, commonly known as Foxconn, have officially announced their strategic alliance aimed at boosting capabilities in the AI data center market. During a press conference held at the Taiwan Stock Exchange, company executives outlined the details of their partnership, which promises to leverage their respective strengths and adapt to the rapidly evolving tech landscape.

Background of the Alliance

TECO Electric has established itself as a leader in the electromechanical systems sector while Foxconn is recognized worldwide for its robust ICT (Information and Communications Technology) solutions. Their collaboration aims not only to enhance operational efficiencies but also to expand their market reach in the growing AI data center business. As the world shifts towards more integrated and modular solutions, this partnership comes at a fortuitous time as demand for sophisticated data management solutions surges globally.

As part of the agreement sanctioned by both companies' boards, TECO will acquire a 0.519% stake in Foxconn, who, in return, will take a 10% stake in TECO. This mutual share exchange culminates in the issuance of millions of new shares by both companies, with the deal expected to finalize by the fourth quarter of the year, pending regulatory approvals.

Exploring New Business Opportunities

Historically, TECO and Foxconn have collaborated on projects focusing on energy efficiency and emission reduction. Now, they aim to delve into the burgeoning data center sector, utilizing their combined expertise in infrastructure and technology. The alliance will facilitate the delivery of a comprehensive suite of data center solutions that encompass everything from AI servers and cooling systems to essential power infrastructure.

The partnership is poised to provide global customers with modular products, MEP (mechanical, electrical, and plumbing) engineering services, and competitive one-stop solutions tailored to various markets, including Taiwan, Asia, the Middle East, and the United States.

TECO's commitment to becoming a pivotal player in the global move towards electrification and sustainable energy aligns perfectly with Foxconn’s initiatives in modular data center designs. With its established presence and local services in the U.S. through TECO-Westinghouse, TECO aims to enhance American manufacturing and continue reshaping the global supply chain.

Strategic Insights from Leadership

TECO’s Chairman, Morris Li, emphasized the importance of their strategic partnership, stating, “Changing global dynamics are creating new opportunities for business and cooperation.” He described the collaboration as an extension of both companies' ongoing projects in low-carbon smart factories and energy services, with aspirations to be recognized as a premier solution provider for future data center needs.

Similarly, Foxconn Chairman, Young Liu, highlighted the urgency of the time-to-market in the competitive supercomputing industry. He noted, “Modular design is gaining popularity, and with TECO, we can offer comprehensive, vertically-integrated solutions to Tier-1 cloud service providers and hyperscalers.” Liu explained Foxconn’s focus on developing modular architectures that would extend their value chain and cost-effectiveness significantly.

Both companies are recognized for their dedication to sustainability, marking their alliance as a stepping stone towards establishing a low-carbon smart industry chain that aligns with international trends. In fact, both TECO and Foxconn featured in the SP Global Sustainability Yearbook 2025, underscoring their commitment to environmental stewardship and corporate responsibility.

About the Companies

TECO Electric

Founded in 1956, TECO has evolved from a motor manufacturer into one of the world's leading producers of industrial motors. The company is known for its diversified operations that include Green Mechatronic Solutions, Intelligent Energy, and Air Intelligent Life. Its well-rounded portfolio demonstrates its commitment to promoting energy efficiency and innovation.

Hon Hai Technology Group (Foxconn)

Established in 1974, Foxconn stands as the largest electronics manufacturer globally, with a remarkable revenue stream and an expansive operational footprint. The company's strategic endeavors include diversifying its technological capabilities in electric vehicles, digital health, and robotics, while maintaining a keen focus on sustainability practices.

In conclusion, the strategic alliance between TECO Electric & Machinery and Foxconn heralds a new chapter in technological collaboration, aiming to reshape not only the AI data center landscape but also to foster a sustainable future in industrial manufacturing.