Fisker Pear to be built at Foxconn’s Lordstown Motors plant

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Actions of lordstown Motors surged more than 23% in pre-bell trading on Thursday after the electric vehicle startup said it had closed the agreement to sell its Ohio facilities to Taiwanese contract manufacturer Foxconn. The Taiwanese firm confirmed it will also make the Fisker’s Pear compact car 2024 model along with the endurance at the Ohio facility.

Closing the deal gives Lordstown Motors some much-needed breathing room and gives production of its electric pickup truck a shot at success, said Danni Hewson, an analyst at AJ Bell.

“Building electric vehicles is an expensive business at the best of times. Right now supply shortages are making life incredibly difficult and Lordstown Motors and its shareholders will feel a rather heady sense of relief today,” Hewson added.

Setting up manufacturing lines for electric vehicles is a capital-intensive process and startups in the past have struggled to raise enough capital to mass-produce vehicles.

Foxconn will now make Lordstown Motors’ Endurance electric pickup, which will go into production in the third quarter of the year and be in customer hands in the fourth quarter.

Lordstown Motors will retain some assets, including its core engine, battery assembly lines and intellectual property. The company said the closing of the deal results in $260 million in profit, including reimbursement for certain operating and expansion costs.

The stock is down more than 95% from its peak of more than $30 a share in September 2020, weeks after going public through a merger with a blank check company. It is currently trading below $2.

Information from Akash Sriram and Bansari Mayur Kamdar in Bengaluru; Edited by Krishna Chandra Eluri

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