The Taiwanese iPhone manufacturer Foxconn will soon make electric vehicles. This week, the company closed on a deal to purchase the former GM manufacturing plant in Lordstown, Ohio. That plant was most recently owned by Lordstown Motors, an EV company with plans to bring its Endurance pickup truck to the market.
GM Lordstown Becomes Lordstown Motors
Foxconn (Hon Hai Technology Group) acquired the plant for $230 million and paid another $27 million to settle related costs. Foxconn owns a stake in Lordstown Motors and will help bring that vehicle to market. Furthermore, Foxconn and Lordstown will co-develop an EV platform under a separate joint venture. That JV is 55 percent owned by Foxconn and 45 percent owned by Lordstown. Foxconn set aside an additional $100 million for the JV including a $45 million loan to Lordstown to support its stake.
Notably, the Lordstown plant was opened in 1966 and updated ahead of production of the compact Chevrolet Cruze sedan that was built there from 2011 to 2019. GM closed the plant in 2019, then sold it to Lordstown Motors.
Foxconn’s investment buys Lordstown time as it plans to bring its Endurance pickup truck to the market this fall. Roughly the footprint of a standard full-size pickup truck, the Endurance would follow the Rivian R1T, GMC Hummer EV, and the Ford F-150 Lightning to the market. However, the company is still cash short and is attempting to raise $150 million to launch Endurance.
Foxconn Partners With Fisker
Should the Endurance project fall through, Foxconn has its JV to build vehicles. Moreover, Foxconn announced that it would build the Fisker PEAR in Lordstown. This move derives from a partnership Foxconn made with Fisker in early 2021 to bring the Personal Electric Automotive Revolution to the market.
The small EV should sell for about $30,000 and come with a $7,500 federal tax credit for eligible buyers. Fisker is currently accepting orders for the PEAR, with an anticipated 2024 availability.
Partnering With Apple
With Lordstown Motors and Fisker in play, Foxconn is poised to become an EV manufacturer. But it may not stop there. Indeed, Apple, the name behind the iPhone and a strategic partner with Foxconn, has ambitions to build EVs.
Nothing is official yet, but the sprawling Lordstown plant might also accommodate Apple. In effect, Foxconn controls the Lordstown facility and seems intent on partnering with multiple manufacturers to build EVs.
The Rush to EVs is On
Over the past year, automakers the world over committed to full electrification. The age of the internal combustion engine seems over and hundreds of billions of dollars in investments are forthcoming. A plant such as Lordstown is positioned to build them, while other factories are promised, but not yet ready.
Over the past few months, we learned that Ford would invest billions in its Blue Oval City project, covering new plants in Tennessee and Kentucky. Furthermore, Toyota announced it would build a facility in central North Carolina and that is about an hour away from a VinFast plant that will break ground in Chatham County this summer.
More recently, Volkswagen announced that the Scout brand would return as an EV line. The company may expand its Chattanooga facility or build a separate plant nearby to accommodate it. Also, Nissan may build a third U.S. manufacturing plant, this one to make room for EVs. The company currently operates plants in Tennessee and Mississippi. Hyundai Kia is eyeing a new plant that could be built in Georgia, which just announced a new Rivian plant.
Lordstown Endurance
Lastly, time is running out for the Lordstown Endurance. Unless funds become quickly available, this model will not see the light of day. Besides the three EV pickup trucks currently in the mix, trucks from Chevrolet, GMC, and Ram will follow. Thus, Lordstown’s future may best be served by its JV with Foxconn.
References
Truett, R. (2022, May 11). Foxconn completes purchase of Lordstown Motors plant, thrusting it into EV-making business. Automotive News. https://autonews.com/manufacturing/foxconn-completes-purchase-lordstown-motors-plant-thrusting-it-ev-making-business
Boney, S. (2022, May 11). Lordstown Motors deal with Foxconn finalized. https://wkbn.com/news/local-news/lordstown-motors-deal-with-foxconn-finalized/
(2022, May 12). Acquiring Ohio EV Plant Sets New Milestone for Hon Hai Foxconn Technology Group. http://foxconn.com/en-us/press-center/press-releases/latest-news/791
Image: The White House from Washington, DC, Public domain, via Wikimedia Commons