iPhone manufacturer Foxconn backs electric truck manufacturer Lordstown Motors
The digital behemoth is investing up to $170 million (£147.8 million) in shares of the struggling startup Lordstown Motors.
The company plans to increase production of its first model, the Endurance, as a result of the significant infusion of cash.
At a former General Motors facility in the US state of Ohio, Lordstown has started producing the automobile.
According to the agreement, Lordstown’s largest investor became the largest contract producer of electronics in the world after purchasing a stake of more than 18%.
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Executive chairman of Lordstown Daniel Ninivaggi stated, “Since announcing our initial deal with Foxconn more than a year ago, it has been our ambition to build a comprehensive strategic cooperation that harnesses the talents of both companies.”
He continued, “Foxconn’s most recent investment is another step in that direction.
However, they did not provide any other information regarding their intent to jointly develop an electric vehicle. The two firms also stated that they will work together to do so.
The collaboration came about as a result of earlier this month’s Reuters news agency story that the world’s largest electric vehicle manufacturer, Tesla, headed by multi-billionaire Elon Musk, planned to begin mass production of the Cybertruck at the end of 2023.
The eagerly anticipated pickup truck that Mr. Musk unveiled in 2019 would have reached its new goal two years later.
The newest financial infusion into Lordstown as it continues to operate at a loss is from Taiwan-based Foxconn.
Separately, on Monday, results for the three months ending in September revealed a net loss of $154.4m, which was higher than the $95.8m loss the business posted for the same period last year.
Following the developments, shares of Lordstown increased by roughly 18% in extended trading in New York.
The Saudi Arabian sovereign wealth fund and Foxconn reached an agreement last week to develop electric automobiles in Saudi Arabia.
The joint venture will do business as Ceer, which is pronounced similarly to the Arabic word for “drive.”
BMW of Germany will provide technology under license to Ceer, which plans to begin selling electric cars in 2025.
The agreement is a part of Saudi Arabia’s effort to wean its economy off of fossil fuels.
Foxconn’s chairman Liu Young-way expressed hope last month that the business may eventually produce automobiles for Tesla as it expands its production of electric vehicles.
Speaking at the business’s annual Tech Day, he stated that as the company develops into producing electric vehicles for well-known automakers, it hopes to emulate its success in producing consumer electronics.