Foxconn invested up to $170 million in Lordstown Motors in exchange for common stock and preferred stock. The Taiwanese electronics giant is deepening investment in US electric pick-up truck companies, which could challenge Tesla’s Cybertruck.
The injection of investment from Foxconn comes as the company aims to ramp up production of its debut model, the Endurance.
With the investment, Foxconn is expected to own all of Lordstown’s outstanding preferred stock as well as 18.3% of common stock on a pro-forma basis. Foxconn itself with the investment has the right to appoint two members of the Lordstown Board of Directors.
Furthermore, Lordstown and Foxconn have agreed to terminate the existing joint venture agreement between them. As Lordstown explained, it was effectively replaced by preferred stock investment.
“Since announcing our first transaction with Foxconn just over a year ago, it has been our goal to develop a broad-based strategic partnership that leverages the capabilities of both companies,” said Lordstown chief executive Daniel Ninivaggi. “Foxconn’s latest investment is another step in that direction,” he added.
The Endurance electric pickup truck is now in production, although it is being built at a “very slow rate” and only 12 trucks have been built so far.
The Endurance electric pickup truck is undergoing testing and awaiting approval from the Environmental Protection Agency and the California Air Resources Board. This prevented delivery, but the company notes final approval is expected later this year.
Ceer will license the technology from Germany’s BMW and is targeted to start selling electric vehicles in 2025.