Foxconn’s takeover of the Auto-Kabel Group cleared

The Bundeskartellamt has cleared under merger control law the takeover of the Auto-Kabel Group by Foxconn Interconnect Technology GmbH (FIT), a subsidiary of the global tech company Hon Hai Precision Industry Co., Ltd., also known as “Foxconn”.

Foxconn is a global manufacturer and distributor of electronic products, including connectors and connectivity solutions for vehicles. The Auto-Kabel Group, some of whose group members are currently undergoing insolvency proceedings, manufactures and sells power distribution systems for vehicles (cables, connection technology, battery wiring harnesses and high-voltage electrical systems). With nine production sites around the world, it supplies both car manufacturers and their suppliers.

Andreas Mundt, President of the Bundeskartellamt: “Foxconn’s takeover of the Auto-Kabel Group does not raise any significant competition concerns. The overlaps between the companies’ activities are limited and competition in the relevant markets will remain strong even after the merger, not least due to the presence of multinational suppliers. The project could be cleared within the one-month deadline in the first phase of merger control.”

The planned merger mainly concerns the manufacture and distribution of cable sets and wiring harnesses for vehicles. These products consist of an assembly of cables and/or wires which are semi-flexibly bound together by clamps, cable ties, tubes, etc. and transmit information signals or electrical power.

The activities of Foxconn and the Auto-Kabel Group overlap only as regards the activities of Foxconn’s subsidiary FIT Voltaira, which is headquartered in Pfullingen, Baden-Württemberg. However, the overlaps in the area of automotive wiring harnesses are minor. In all possible scenarios considered, the combined market shares are well below the thresholds that would give rise to concerns. Other possible competition problems, such as foreclosure effects, are not expected to arise either.