Foxconn grows stake in US EV truck manufacturer Lordstown

Foxconn grows stake in US EV truck manufacturer Lordstown

Foxconn, the world’s largest contract electronics maker, increased its stake in loss-making US electric truck manufacturer to 18.3% with an investment now totalling around US$170 million. The Taiwan-based iPhone manufacturer continues to diversify away from its core markets with investments in semi-conductors and electric vehicles (EVs).

Blue View

Foxconn began the manufacture of Lordstown’s Endurance pickup trucks in September following the purchase of the US company’s Ohio facility. The latest deal will continue to strengthen Lordstown’s ties with Foxconn’s EV development platform Mobility in Harmony (MIH). The funds will be used to develop and design a new EV program replacing the earlier joint venture between the companies. Lordstown will also look to potentially provide its combined production services to other original equipment manufacturers (OEMs).

Lordstown posted a net loss of US$154m in the third quarter of 2022 with rising materials costs resulting in a limited initial production run for the Endurance pickup through 2022 and into 2023. The current inflated materials costs mean the Endurance list price is currently not economic and therefore production beyond the order book has been delayed.

The investment also now requires a review by the Committee on Foreign Investment in the United States (CFIUS), which will evaluate whether the foreign investment poses a potential national security risk. This may prohibit any further investment by Foxconn in the US-based entity beyond a 20% threshold.

This is an interesting juxtapose felt around the western world, recently posed in the UK for its domestic gigafactory investment in Britishvolt. Just how comfortable are national politicians in trading-off domestic ownership to secure domestic supply (and jobs) in the EV supply chain? This trade-off between domestic production and domestic ownership still has a long way to go to eventual settle on how we will define supply chain security in the future.

  • 09 Nov 2022
  • China
  • USA
  • Life Insurance Corporation of India
  • Automotive
  • Batteries

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