Yahoo Finance Foxconn Says Lordstown Plant Useful No Matter How Dispute Ends
(Bloomberg) -- Foxconn Technology Group will be able to make good use of its electric-vehicle factory in Lordstown, Ohio, no matter how its dispute with Lordstown Motors Corp. is resolved, Chairman Young Liu said.
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Earlier this month, Lordstown Motors warned that it may be forced to cease operations after Foxconn said it’s prepared to pull out of a production partnership with the EV maker. “We remain open to continued dialogue to find the best solution for each other,” Liu said in a post-earnings briefing Thursday.
Foxconn agreed last year to invest as much as $170 million in Lordstown Motors, giving the company much-needed capital to build electrified trucks. The deal, along with the $230 million purchase of the former General Motors Co. factory in Ohio, is part of Foxconn’s plan to strengthen its position as a provider of EV production capacity and technology.
“We are taking a multi-customer approach to optimize and allocate this capacity we have in Ohio,” Liu said, adding that the recently enacted Inflation Reduction Act has made the factory more attractive. “In the past couple of years, Foxconn has been proactively seeking customers. Now, the interest is two-way; we are also being approached by potential customers as well — I’m talking about traditional auto OEMs.”
Lordstown Motors said in a May 1 filing that its deal with Foxconn could unravel after the Taiwanese company threatened to withhold funding, and that it was seeking alternative financing. Representatives for the carmaker weren’t immediately available to comment outside regular US business hours. Shares of Lordstown Motors have declined 68% this year.
“We have seen in the past month how tough disruption is for the EV industry,” Liu said, adding that the issue with Lordstown Motors won’t impact Foxconn’s approach to production at the plant. “I would prefer to talk less in public and instead do more to come up with solutions for our stakeholders.”
Foxconn has set ambitious targets for its auto business, betting that it can help legacy manufacturers and startups assemble EVs in the same way that it provides production capacity for Apple Inc. and its iPhones and PlayStations for Sony Group Corp. The contract manufacturer is betting that it can capture 5% market share by 2025.
“The next two years are a period of active courtship of new customers,” Liu said.
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