technology

Foxconn set to purchase Ohio EV factory of Lordstown Motors for $230Mn

Foxconn set to purchase Ohio EV factory of Lordstown Motors for $230Mn
Foxconn set to purchase Ohio EV factory of Lordstown Motors for $230Mn

Foxconn, the Taiwanese conglomerate, is reportedly purchasing an automotive factory from struggling EV firm Lordstown Motors for close to USD 230 million. The company stated that it has agreed to construct the electric pickup truck of Lordstown Motors at the facility, which is where General Motors used to produce the Chevrolet Cruze. The startup will remain as a tenant at the facility. Lordstown Motors will also agree to offer Foxconn definite rights with respect to the vehicle programs of the future.

The agreement gives the iPhone assembler its first automobile factory and a substantial new presence in the U.S., one that Foxconn will use as it attempts to exhibit itself as a global EV automaker. Previously, Foxconn announced a huge LCD panel factory located in Wisconsin but was unable to deliver the promises it made to the state.

Under the deal, Foxconn is also purchasing Lordstown Motors shares worth USD 50 million. The company recently affirmed that it needs to raise funds for staying operational, despite going public in 2020.

In 2019, Lordstown Motors purchased the 6.2 million sq. ft. facility from General Motors just after the automotive giant shut it down, a decision which was opposed by Donald Trump, the former President of the United States.

The startup had announced in August that it was planning on renting out the factory space in an effort to earn money amidst a serious cash crunch. Since the purchase, Lordstown Motors has put around USD 240 million worth of work into preparing the factory for producing Endurance, its electric pickup truck.

When Lordstown Motors purchased the General Motors factory, Trump applauded the deal stating that it was great news for the state of Ohio. But since then, the startup has run into a lot of trouble despite raising hundreds of millions of dollars in 2020.

Foxconn spent much of 2020 talking about its expansion in electric vehicles as a way of diversifying away from consumer electronics. The company has also developed its own platform of electric vehicles that it aims to sell to other auto manufacturers.

Source credits:

https://www.theverge.com/2021/9/30/22702322/lordstown-motors-foxconn-ohio-electric-vehicles

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Sunil Jha

Sunil Jha has been a part of the content industry for close to two years. Having previously worked as a voice over artist and sportswriter, he now focuses on writing articles for newsorigins.com, across a slew of topics, ranging from technology to trade and finance. With a business-oriented educational background, Sunil brings forth the expertise of deep-dive research and a strategic approach in his write ups.