Taiwan's Foxconn, the maker of the Apple iPhone, has finalized the acquisition of Lordstown Motors' plant in Ohio and announced new investment plans.
Hon Hai Technology Group, which trades under the Foxconn name, has paid $230 million to Lordstown Motors for the 6.2 million-square-foot plant and said it is investing $100 million more together with the EV startup to set up a product development venture to create EVs.
As part of the deal that was first announced in November 2021, Foxconn also assumes the responsibility for assembling the battery-electric Endurance pickup, with 400 Lordstown manufacturing employees being transferred to the Taiwanese company. Lordstown Motors will continue to be in charge of design, engineering, testing, industrialization, sourcing, homologation and launch of vehicle programs.
The $100 million investment into a joint venture affiliate with Lordstown Motors will see the new unit engineer EVs based on Foxconn's Mobility in Harmony Open EV platform. The two parties said they would co-design and develop vehicle programs for the global commercial vehicle market. Hon Hai is investing $55 million in the new joint venture in exchange for 55% of shares.
However, the cash injection might not be enough to ensure production of the Endurance starts on schedule this fall, Lordstown Motors CEO Daniel Ninivaggi told Automotive News. The EV startup is working to raise an additional $150 million to be able to start limited production in the third quarter of 2022 and deliveries expected in the fourth quarter.
Earlier this week, Lordstown reported an $89.6 million first-quarter loss, compared to $125.2 million a year earlier. The company had a cash balance of $204 million, down from $587 million in Q1 2021. The company had received $200 million in down payments from Foxconn for its assets.
Foxconn plans to use the plant in Lordstown, Ohio, as its "important electric vehicle manufacturing hub in North America." The company aims to assemble vehicles for third parties as a contract manufacturer.
Fisker said that an affordable EV, codenamed Pear, will be built by Foxconn at the Lordstown plant. The Taiwanese company might also manufacture vehicles for Apple, which is known to be working on its first car project.