Photo: Lordstown Motors
Things are not going well for Lordstown Motors. After its very first prototype caught fire ten minutes after starting its very first test on public roads, Hindenburg Research denounced that the company’s CEO was inflating pre-order numbers. Steve Burns left the company and was replaced by Dan Ninivaggi, who said his primary mission was to maximize the Lordstown facility. According to Bloomberg, he accomplished that by selling the factory to Foxconn.
The deal is supposed to be announced this week and to ensure that Lordstown can still produce the Endurance at the plant. As Bloomberg notes, even if the electric pickup truck sold really well, it would be pretty tricky for Lordstown to use all the factory capacity with a single product.
For a company that wants to supply manufacturing services for EVs like Foxconn, buying the factory can be a deal made in heaven. It would grant the Taiwanese company the industrial presence it wants to have in the U.S. with a relatively low investment. Apart from Lucid, most EV startups started production with factories that belonged to other carmakers.
On Lordstown Motors’ side, having Foxconn in its boat may help it get some credibility after the Hindenburg Research burned down some of the company’s claims. However, the most pressing advantage the deal carries for the startup is to raise much-needed cash to keep developing the Endurance. The additional funds will probably come in handy to cope with the SEC investigation that the Hindenburg Research report raised.
When the deal is disclosed, it may also help answer some questions about the Lordstown Endurance. Its battery pack supplier was a mystery, for example. We tried to find them to discuss the fire on the company’s first prototype. Foxconn will probably introduce a new battery pack supplier. It would not be unlikely that the Endurance also skipped the in-wheel motors from Elaphe and adopted a more conventional approach. If Bloomberg’s sources are correct, we’ll learn more about that in a few hours.
For a company that wants to supply manufacturing services for EVs like Foxconn, buying the factory can be a deal made in heaven. It would grant the Taiwanese company the industrial presence it wants to have in the U.S. with a relatively low investment. Apart from Lucid, most EV startups started production with factories that belonged to other carmakers.
On Lordstown Motors’ side, having Foxconn in its boat may help it get some credibility after the Hindenburg Research burned down some of the company’s claims. However, the most pressing advantage the deal carries for the startup is to raise much-needed cash to keep developing the Endurance. The additional funds will probably come in handy to cope with the SEC investigation that the Hindenburg Research report raised.
When the deal is disclosed, it may also help answer some questions about the Lordstown Endurance. Its battery pack supplier was a mystery, for example. We tried to find them to discuss the fire on the company’s first prototype. Foxconn will probably introduce a new battery pack supplier. It would not be unlikely that the Endurance also skipped the in-wheel motors from Elaphe and adopted a more conventional approach. If Bloomberg’s sources are correct, we’ll learn more about that in a few hours.
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