Taiwanese contract producer Foxconn late on Thursday introduced a non-binding settlement to buy the sprawling automobile plant positioned in Lordstown, Ohio, from cash-strapped electrical automobile startup Lordstown Motors.
Under the deal, Foxconn will buy the plant for $230 million along with $50 million value of frequent inventory in Lordstown.
Lordstown bought the plant from General Motors in 2019, with the purpose of constructing its first product, the Endurance electrical pickup truck, on the website.
Following the closing of the deal, Lordstown plans to barter one other deal that can see Foxconn manufacture the Endurance underneath contract. The two corporations have additionally agreed to discover the potential for extra automobile packages.
Lordstown Motors manufacturing unit – 2020
Lordstown additionally plans to ascertain a long-term lease for a portion of the plant. The plant buy by Foxconn doesn’t embrace Lordstown’s manufacturing strains for electrical motors and batteries, so Lordstown should still manufacture elements for its personal automobiles on the website, and probably for different corporations wanting to make use of the elements.
One such firm might be Fisker. Foxconn in May introduced that it’s working with rival EV startup Fisker to start out manufacturing of an inexpensive EV within the U.S. by late 2023.
Foxconn has additionally unveiled its personal modular EV platform and can be engaged on contract manufacturing of automobiles in China with Geely.
The settlement between Foxconn and Lordstown comes only a month after Lordstown introduced the hiring of latest CEO Daniel Ninivaggi to exchange former CEO and firm founder Steve Burns who stepped down abruptly in June together with former CFO Julio Rodriguez. They left after an inside investigation discovered “issues regarding the accuracy of certain statements regarding” pre-orders for the Endurance—a matter the Justice Department can be trying into.