Lordstown Motors (RIDE) shares surged higher Tuesday after the upstart electric vehicle maker unveiled a new equity investment from Taiwan-based Apple (AAPL) supplier Foxconn.
Lordstown said Foxconn, formally known as Hon Hai Precision Manufacturing, will take an 18.3% stake in the group, as well as two seats on the board, for an equity injection of around $170 million. The deal, which will be run through Foxconn affiliate Foxconn Ventures Pte Ltd., will make it the biggest Lordstown shareholder, topping that of found Stephen Burns.
Foxconn, the world's biggest contract electronics manufacturer, purchased Lordstown's Ohio-based facility earlier this year. That plant, with Foxconn's assistance, is now producing the carmaker's Endurance pickup truck.
“Over the last year, the Lordstown Motor and Foxconn teams have worked collaboratively to bring the Endurance into commercial production, despite numerous external challenges," said CEO Ed Hightower, a former Ford (F) and General Motors (GM) executive who took over the role earlier this summer. "We acknowledge and appreciate the confidence in our team that is shown by this investment."
"The combination of LMC’s experienced vehicle development team, Foxconn’s growing EV ecosystem, the MIH platform, and our asset-light business model will allow us to bring great EVs to market faster and more efficiently,” he added.
Lordstown shares were marked 12.7% higher in early Tuesday trading to change hands at $2.09 each, a move that would still leave the shares down more than 44% for the year.
