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Weeks after announcing an initial agreement for a massive Ohio auto assembly plant, technology giant Foxconn and electric vehicle startup Lordstown Motors Corp. have made the deal official.
The firms announced Nov. 10 that Foxconn — formally known as Hon Hai Technology Group — purchased LMC’s 6.2-million-square-foot plant in Lordstown, Ohio, for $230 million.
Foxconn will pay $100 million by Nov. 18, and make two more $50 million payments by April 15 of next year, before paying the remaining balance at the deal’s closing, tentatively targeted for April 30. The transaction does not include certain production-line assets.
“This partnership marks the commencement of integrating our resources with Lordstown Motors to develop Ohio into Hon Hai’s most important electric vehicle manufacturing and R&D hub in North America,” Young Liu, Hon Hai’s chairman, said in a news release.
Along with the factory sale, the two companies agreed to pursue a contract manufacturing deal for Foxconn to make Lordstown’s Endurance pickup truck. The agreement is required to be finalized before the facility purchase closes. The two companies also plan to co-design and develop electrical vehicle programs for commercial fleets with an option to market those programs globally.
“In my view, this transaction provides LMC a better opportunity to fulfill its original mission of satisfying the growing demand for electric vehicles, particularly in the underserved commercial market, with a more flexible business model,” said Daniel Ninivaggi, Lordstown’s chief executive.
General Motors operated the Lordstown plant from its 1966 opening until shuttering it in March 2019. LMC bought it later that year.
Image Credit: Michael Wayland / CNBC
