Photo: Lordstown Motors
Foxconn is not done funding Lordstown. After it purchased its factory in Ohio for $230 million and promised to invest $100 million in a joint venture in May, it will now invest up to $70 million more in the American startup by purchasing Lordstown common stock. While some people are talking about $170 million more, that is not correct.
The Taiwanese company will also buy $100 million in preferred stock, but that investment only replaces the $100 million backing in the joint venture it would have with Lordstown. That said, this is an amount that was already committed to the startup and had already been announced, even if not in the same way.
Lordstown will put the $70 million from the common stock sale into “general corporate purposes.” The $100 million will go to the development of a new vehicle with the help of Foxconn’s Mobility-in-Harmony (MIH) Open Platform. The American startup confirmed it has started working on this new vehicle, but it did not disclose what it intends to build with Foxconn.
The safest bet is another electric pickup truck. Lordstown Motors already said that it would focus on commercial vehicles, focusing on fleet owners. That alone restricts the options quite a bit. On the other hand, it also suggests Foxconn may already have the answer with minor tweaks.
Just remember the Foxtron Model V, an electric pickup truck Hon Hai presented in October. We wrote at the time that the new vehicle could fit Lordstown’s lineup. Considering Foxconn stated categorically that it has no intentions of becoming a car maker – only to sell manufacturing services – putting a Lordstown badge on it would be a way to sell a pickup truck quickly in the American market.
To corroborate that, $100 million is just a fraction of the money needed to develop any new car project. They usually cost north of $1 billion, even with a platform already used by other vehicles. Either Foxconn already has something almost ready for production, or it will need to invest more money in developing the new Lordstown EV. The first hypothesis makes more sense.
Lordstown will put the $70 million from the common stock sale into “general corporate purposes.” The $100 million will go to the development of a new vehicle with the help of Foxconn’s Mobility-in-Harmony (MIH) Open Platform. The American startup confirmed it has started working on this new vehicle, but it did not disclose what it intends to build with Foxconn.
The safest bet is another electric pickup truck. Lordstown Motors already said that it would focus on commercial vehicles, focusing on fleet owners. That alone restricts the options quite a bit. On the other hand, it also suggests Foxconn may already have the answer with minor tweaks.
Just remember the Foxtron Model V, an electric pickup truck Hon Hai presented in October. We wrote at the time that the new vehicle could fit Lordstown’s lineup. Considering Foxconn stated categorically that it has no intentions of becoming a car maker – only to sell manufacturing services – putting a Lordstown badge on it would be a way to sell a pickup truck quickly in the American market.
To corroborate that, $100 million is just a fraction of the money needed to develop any new car project. They usually cost north of $1 billion, even with a platform already used by other vehicles. Either Foxconn already has something almost ready for production, or it will need to invest more money in developing the new Lordstown EV. The first hypothesis makes more sense.
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