Foxconn completes acquisition of Lordstown Motors electric truck factory

Taiwan’s Foxconn Technology Group completed a transaction with Lordstown Motors Corp. to acquire the electric-truck startup’s Ohio factory for $230 million and take over production of its Endurance pickup truck, a critical step as the iPhone manufacturer seeks to diversify into electric vehicles.

Foxconn will invest $55 million for 55% of a joint venture for product development, and will take on approximately 400 Lordstown employees, the company said in a statement. The facility will become the Taiwanese company’s EV manufacturing hub for North America, it said.

Foxconn, the primary assembler of iPhones for Apple, has been looking to expand in the fast-growing electric-vehicle market with a similar business model, in which it would handle manufacturing for automakers. On Thursday, EV maker Fisker Inc. reaffirmed its plan to have Foxconn build the upcoming Fisker Pear model at the Ohio factory starting in 2024. Another potential customer would be Apple, which has been exploring getting into the auto business for years.

The finalization of the Ohio transaction provides relief for Lordstown, whose shares rallied on the news after the close of regular U.S. trading Wednesday and were up about 17% to $1.77 in premarket trading Thursday. The company’s stock sank May 9 after it said the closing might be delayed as late as May 18.

Foxconn previously had made $200 million in down payments toward the purchase. Had the deal not closed, Lordstown would have had to pay the money back -- something it didn’t have enough cash to do.

The transaction creates a lifeline for Lordstown Motors, which now can benefit from the giant company’s purchasing power. Foxconn will operate the factory, including some equipment that Lordstown will continue to own, such has its hub-motor assembly and battery module lines, the Ohio company said.