Shares in Foxtron Vehicle Technologies fell in their market debut on Monday, hurt by concerns over headwinds in the highly competitive electric vehicle market, Reuters reported.

Shares did recover some ground from earlier losses of as much as 9%, ending down 2.7% which gave the company market capitalisation of around US$2.7bn.

“The EV market has been flooded by a red sea of price cuts by major players such as Tesla,” an unnamed analyst told Reuters.

“Foxtron has lost money in 2021 and 2022, and we don’t think it will turn that around in the next two years.”

Foxtron is a joint venture between Foxconn – the world’s largest contract manufacturer for iPhones and other consumer electronics – and local car maker Yulon. It currently has only one client, Luxgen, which is owned by Yulon.

Young Liu, chairman of both Foxtron and Foxconn, reportedly said, however, the company has a clear strategy for growth.

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“Foxtron will build its foundation in Taiwan, leveraging our own design and service momentum in EV, as well as Foxconn’s proven business models to guide our entry into the North America, Southeast Asia mainstream markets.”

The company raised T$7.5 billion ($235 million) in its initial public offering, Reuters said.