Lordstown Motors announced on Thursday plans to sell its Ohio assembly plant to the Taiwan-based Foxconn for $230 million.
The deal was forged between Lordstown and the Taiwan-based electronics contract manufacturer to produce an all-electric pickup truck called the Endurance, the first of its kind for Lordstown that is set to be developed and sold beginning next year, according to CNBC.
“In addition to achieving the goal of moving ahead our timeline to establish electric vehicle production capacity in North America, it also reflects Foxconn’s flexibility in providing design and production services for different EV customers,” said Young Liu, chairman of Hon Hai Technology Group, according to CNBC.
With Lordstown stock up on Thursday by 21% following the announcement, the agreement also requires that Foxconn purchase $50 million in Lordstown common stock.
“The partnership would allow Lordstown Motors to take advantage of Foxconn’s extensive manufacturing expertise and cost-efficient supply chain while freeing up Lordstown Motors to focus on bringing the Endurance to market, developing service offerings for our fleet customers, and designing and developing innovative new vehicle models,” Lordstown CEO Daniel Ninivaggi said in a statement, according to CNBC.
In selling the plant to Foxconn, also known as Hon Hai Technology Group, Lordstown will be able to enter the electric vehicle (EV) manufacturing competition. The plant will also give Foxconn a jumpstart in producing EVs through its own deal with start-up Fisker to produce electric vehicles in the coming years, according to CNBC.
The 6.2 million-square-foot facility in Lordstown, Ohio, was purchased by the company in 2019 from General Motors when operations ceased at the plant as part of a restructuring plan. Now, the facility's ownership will fall specifically to Foxconn.
While the Taiwan-based electronics manufacturer is best known for iPhone production, the new agreement between Lordstown and Foxconn will serve to broaden their production to electric vehicles as well, according to CNBC.