Apple Supplier Foxconn Confirms Deal To Buy Lordstown Ohio Plant, Fisker PEAR Could Come Sooner

Apple Supplier Foxconn Confirms Deal To Buy Lordstown Ohio Plant, Fisker PEAR Could Come Sooner

Key Apple Inc AAPL supplier Hon Hai Precision Industry Co., Ltd. HNHPF is in discussion with pre-production electric vehicle startup Lordstown Motors RIDE to buy its Ohio assembly plant and build electric vehicles there for its partner Fisker Inc FSR, the companies said on Thursday.

What Happened: The Taiwan-based supplier, better known as Foxconn, would buy the facility for $230 million and also plans to take over the manufacturing for Lordstown’s Endurance full-size electric pickup trucks, as per the in-principle agreement.

The deal excludes Lordstown’s hub motor assembly line, battery module and packing line assets, certain intellectual property rights and other excluded assets, the companies said.

Foxconn and Lordstown would also explore licensing arrangements for additional pickup truck programs.

See Also: Lordstown Motors Could Have Cash Lifeline With Foxconn Factory Sale: What Investors Should Know

Young Liu, Chairman of Foxconn, said the deal would help accelerate the company's timeline to establish electric vehicle production capacity in North America while simultaneously providing design and production services for different EV customers.

Once the deal closes, Lordstown Motors will issue warrants to Foxconn for 1.7 million shares of common stock at an exercise price of $10.50 per share.

What It Means For Fisker-Foxconn Partnership: The development would speed up the Los Angeles, California-based Fisker and Foxconn’s joint venture to launch Project PEAR (personal electric automotive revolution), as per Fisker co-founder Henrik Fisker. 

The partnership plans to bring an electric vehicle for under $30,000 to markets including North America, Europe, China and India.

Separately, Fisker plans to launch its Ocean SUV — which would be assembled by automotive contract manufacturer Magna International MGA in Europe —in November 2022.

Price Action: FSR shares closed 0.27% lower at $14.65 on Thursday and were up 3.82% in after-hours. RIDE shares closed 8.42% higher at $7.98 and were further up 8.15% in after hours.

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Photo: Courtesy of Nadkachna via Wikimedia

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