Lordstown Motors. Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images
Bloomberg reported that Lordstown Motors plans to sell its Ohio plant to Foxconn.
According to the report, the companies would work simultaneously at the plant.
The deal could be announced within the week.
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Lordstown Motors shares rose 7% on Thursday morning after a report revealed that the struggling electric-car manufacturer is looking to sell its Ohio plant to Foxconn. Foxconn is expanding into EV manufacturing.
Sources told Bloomberg that the deal could be announced by both companies as early as this week. However, financial terms are still not clear.
Bloomberg reported that the agreement would allow Foxconn Motors and Lordstown Motors – who originally bought the highly-politized plant from General Motors in 2019, to work in parallel at a factory that once housed 10,000 GM employees.
Donald Trump, former President, cheered Lordstown’s purchase of the closed GM plant and showed the pickup truck to the White House.
Foxconn is pushing to manufacture electric cars in the US. The top assembler for Apple iPhones made a deal in May to make EVs available to startup Fisker.
Lordstown Motors declined comment and a Foxconn representative did not immediately respond.
Lordstown was founded in 2018 and went public in October 2018. The company was valued at $1.6 billion in a merger. The company has been hyped up by retail investors who have been investing in SPACs and electric vehicle makers. The company has seen a number of obstacles and has lost around three-quarters its market value this year.
Hindenburg Research, a short-selling company, released a report alleging that the company misled investors about demand for its electic pickup truck Endurance. This prompted an inquiry by the Securities and Exchange Commission.
In June, the CEO and CFO resigned. This was the day that an internal investigation by the company revealed that it had "made periodic disclosures about pre-orders which were in some respects inaccurate."
Lordstown also warned investors that there was not enough cash to begin commercial production of the electric pickup. The original plan was to mass produce the Endurance in this fall. However, Lordstown now plans to start deliveries next year.