Introduction: The acquisition plan of Foxconn-made cars and electric vehicle startup Lordstown Motors (Lordstown Motors) has finally ushered in new progress.
On May 12, according to multiple media reports, Foxconn acquired an automobile assembly plant of the electric vehicle startup Lordstown Motors (Lordstown Motors) in Ohio, USA at a purchase price of US$230 million. In addition to the $230 million purchase, Foxconn also paid $465 million worth of investment and loan packages for Lordstown Auto, so Foxconn’s acquisition of Lordstown Auto has spent a total of $695 million (equivalent to RMB 4.7 billion). In fact, as early as last November, Foxconn had plans to acquire the factory. On November 11 last year, Foxconn disclosed that it had acquired the factory for $230 million.
The automobile assembly plant of the electric vehicle startup Lordstown Motors in Ohio, USA, was the first factory owned by General Motors in the United States. Previously, the plant produced a series of classic models including Chevrolet Caprice, Vega, Cowards, etc. Due to changes in the market environment, since 2011, the factory has only produced one model of the Cruze, and later, the compact car has become less and less popular in the US market, and the factory has a problem of overcapacity. In March 2019, the last Cruze rolled off the assembly line at the Lordstown factory and announced in May of the same year that it would sell the Lordstown factory to a local new force, Lordstown Motors, and loaned the latter US$40 million to complete the factory acquisition. .
According to the data, Lordstown Motors (Lordstown Motors) is a new power brand in the United States. It was founded in 2018 by the former CEO (CEO) of American freight truck manufacturer Workhorse, Steve Burns, and is headquartered in Ohio. Lordstown. Lordstown Motors acquired General Motors’ Lordstown plant in May 2019, merged with a shell company called DiamondPeak Holdings in October of the same year, and listed on Nasdaq as a special acquisition company (SPAC). The new force was valued at $1.6 billion at one point. Since the outbreak of the epidemic in 2020 and the shortage of chips, the development of Lordstown Motors in the past two years has not been smooth. Lordstown Motors, which has been in a state of burning money for a long time, has spent almost all the cash previously raised through SPAC mergers. The sale of the former GM factory is considered to be an important part of easing its financial pressure. After Foxconn acquired the factory, Foxconn and Lordstown Motors will establish a joint venture “MIH EV Design LLC” with a 45:55 shareholding ratio. This company will be based on the Mobility-in-Harmony released by Foxconn in October last year. (MIH) open source platform to develop electric vehicle products.
As for Foxconn, as a well-known technology company “the world’s largest electronics foundry”, Foxconn was founded in 1988. In 2007, it became Apple’s largest foundry due to Foxconn’s contract production of iPhones. “The King of Workers”, but after 2017, Foxconn’s net profit began to shrink. In this context, Foxconn had to develop diversified operations, and cross-border car manufacturing happened to be a popular cross-border project.
Foxconn’s entry into the auto industry began in 2005. Later, it was reported in the industry that Foxconn had contacts with many automakers such as Geely Automobile, Yulon Automobile, Jianghuai Automobile, and BAIC Group. Started any car building program”. In 2013, Foxconn became a supplier to BMW, Tesla, Mercedes-Benz and other car companies. In 2016, Foxconn invested in Didi and officially entered the car-hailing industry. In 2017, Foxconn invested in CATL to enter the battery field. In 2018, Foxconn’s subsidiary Industrial Fulian was listed on the Shanghai Stock Exchange, and Foxconn’s car manufacturing made further progress. By the end of 2020, Foxconn began to reveal that it would enter electric vehicles and accelerate the layout of the electric vehicle field. In January 2021, Foxconn Technology Group signed a strategic cooperation framework agreement with Byton Motors and Nanjing Economic and Technological Development Zone. The three parties worked together to promote the mass production of Byton’s new energy vehicle products and stated that they would achieve M-Byte by the first quarter of 2022. mass production. However, due to the deterioration of Byton’s financial situation, the cooperation project between Foxconn and Byton has been shelved. On October 18 of the same year, Foxconn released three electric vehicles, including an electric bus Model T, an SUV Model C, and a business luxury car Model E. This is the first time Foxconn has shown its products to the outside world since it announced the manufacture of a car. In November of the same year, Foxconn invested heavily in the acquisition of the former General Motors factory (the event mentioned above). At that time, Foxconn stated that it would purchase the land, plant, team and some equipment of the factory for $230 million as its first auto factory. Earlier this month, Foxconn was also revealed to be an OEM Apple car, but at that time Foxconn responded with “no comment”.
Although Foxconn has no experience in the field of car manufacturing, at the 2021 fourth quarter investment legal person briefing held by Hon Hai Group (Foxconn’s parent company) in March this year, Hon Hai Chairman Liu Yangwei has begun to make new energy tracks. A clear plan was made. Liu Yangwei, chairman of Hon Hai, said: As one of the main axes of development of electric vehicles, Hon Hai will continue to expand the customer base, seek the participation of existing car factories and new car factories, and assist customers in mass production and expansion. It pointed out: “Hon Hai’s electric vehicle cooperation has always been in progress according to the schedule. Accelerating commercial transfer and mass production, and developing higher-value components and software will be the focus of Hon Hai’s EV development in 2022. By 2025, Hon Hai will Hai’s target is 5% of the market share, and the vehicle production target will be 500,000 to 750,000 units, of which the revenue contribution of vehicle foundry is expected to exceed half.” In addition, Liu Yangwei also proposed that Foxconn’s electric vehicle Auto-related business revenue will reach 35 billion US dollars (about 223 billion yuan) by 2026. The acquisition of the former GM factory also means that Foxconn’s car-making dream may have further progress.
Post time: May-20-2022