Electric pickup truck makers Lordstown Motors is positioned to sell their plant in Ohio to Foxconn Technology Group out of Taiwan, according to reports. A deal is imminent, according to an unnamed source who isn’t authorized to speak about the transaction publicly. It’s expected that the agreement will be announced later this week.
The purchase would be for the facility, and Lordstown Motors would continue to occupy a part of the factory as they do currently. It’s where the Endurance pickup is set to be built. However, it would help Foxconn establish a foothold in the US for manufacturing. Foxconn is the largest iPhone assembler in the world, but just last month they expressed an intention to build an EV plant in the US as well as in Thailand.
Purchasing the Lordstown factory would put them ahead of schedule with manufacturing capabilities. Chairman Liu Young-way stated on an earnings call with investors that they planned to build the American and Thai factories in 2022 and begin mass-manufacturing EVs the following year. Currently, Foxconn has an agreement to build a Fisker EV known as Project Pear beginning in 2023.
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Lordstown Motors Corp purchased the Ohio plant late in 2019. Since then, the company has merged with a SPAC to be listed publicly on Nasdaq, then dragged through the mud by Hindenburg Research who made allegations of fake pre-orders of the Endurance pickup and misleading “investors on both its demand and production capabilities”. Hindenburg Research notoriously short sells companies that they first blow up. An SEC investigation and the Justice Department concluded that inaccurate statements were made, in fact, although from prior management.
Since last year, Lordstown has shed nearly three-quarters of its market value.
A deal puts the factory to use
Should the Foxconn deal proceed, it would put the Ohio plant to use in a much larger capacity. At its peak, the assembly plant put out 300,000 Chevrolet Cruzes per year and employed 10,000 people. Of the plant’s 6.2 million square feet, the Endurance production will be at a much smaller capacity – around 20,000 units per year. Lordstown employs around 450 people, according to GrowJo.
Last month, newly-appointed Lordstown CEO Dan Ninivaggi took over for founder and CEO Steve Burns.
He said at that time, “The key to unlocking financial potential is maximizing the value of the Lordstown facility. We are exploring a number of alternatives. It could take a number of different forms. That is job one for me.”
It’s taken only a few weeks from Ninivaggi’s appointment for the deal to be reported, albeit unofficially. For the ventures they’re involved in, Foxconn already has plans to produce hundreds of thousands of EVs annually.
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