LORDSTOWN, Ohio (WKBN) – Three years after the last Cruze rolled off the line at what was then General Motors, the Lordstown plant received some good news for the future.
The deal between Lordstown Motors and Foxconn has been finalized.
Lordstown Motors announced Wednesday afternoon it has closed the sale of the former GM Lordstown plant and signed a contract manufacturing agreement with Foxconn.
In a press release, Lordstown Motors said the $230 million transaction plus reimbursement of approximately $27 million for other operating and expansion costs under the Asset Purchase Agreement was closed on Wednesday.
The agreement hinged on many conditions including the manufacturing partnership for LMC’s flagship vehicle, the Endurance.
In addition, Foxconn had previously purchased $50 million of LMC stock directly from the company.
The start of commercial production of the Endurance is targeted for the third quarter of this year, with the first commercial deliveries expected in the fourth quarter.
Foxconn will assume manufacturing operations at the Lordstown plant immediately and there will be no interruption in production.
Approximately 400 LMC employees will transition to employment with Foxconn. LMC will retain a presence in Lordstown, along with engineering and technical centers and corporate staff in Farmington Hills, Michigan and Irvine, California.
Also part of the deal is a partnership between the two companies to co-develop EV programs using Foxconn’s Mobility-in-Harmony (MIH) open-source EV platform. The new joint venture will be called MIH EV Design LLC and will be 55% owned by Foxconn and 45% by LMC.
Foxconn is committing $100 million toward the new joint venture, including a loan to Lordstown for $45 million to support its initial capital commitment.
The joint venture creates a business model whereby LMC and Foxconn would jointly develop new electric vehicles, utilizing the MIH platform, for LMC in the North American commercial vehicle market and for other OEMs internationally.
“I have always been a strong believer in what Foxconn is doing to accelerate the adoption of electric vehicles and we are proud to be their partner,” tweeted Lordstown Motors CEO Dan Ninivaggi.
“The biggest thing everybody was concerned about was how much money Lordstown Motors would be able to raise to keep this project going. Now, it appears that’s been solidified and they’re actually moving forward. It’s very exciting news for the village of Lordstown and the Mahoning Valley,” said Lordstown Mayor Arno Hill.
Congressman Tim Ryan released the following statement after hearing the news.
“I am thrilled that Lordstown Motors has reached a finalized deal with Foxconn, marking a transformative and historic moment in our work to solidify Northeast Ohio as America’s Voltage Valley… I’d like to congratulate both Lordstown Motors and Foxconn on this monumental investment in our workers, our community, and the future of electric vehicle manufacturing in the United States.
Foxconn knows what our Valley workforce is capable of, and I know they will help make the Mahoning Valley the North American hub for electric vehicle production. I stand ready to do everything in my power to support Foxconn in this transition.”
The announcement came after the stock market closed but in after-hours trading, Lordstown Motors’ stock rose 37 cents a share, or 25%, and closed at $1.81 a share.
Patty Coller contributed to this report.