Foxconn, a Taiwanese electronics company, has started production of Lordstown Motors’ electric pickup truck.
In its Ohio plant, the business has so far constructed two trucks for customers. It plans to finish a third truck soon. By the end of the year, the company hopes to have delivered approximately 50 trucks to customers.
Edward Hightower, who took over as CEO of Lordstown in July after the company completed the sale of its facility to Foxconn, stated that everything is going as planned.
“We will continue to develop slowly as we address lingering part pedigree and part availability challenges,” he explained. “We expect to accelerate manufacturing in November and December.”
Lordstown expects to significantly improve its output rate in 2023. However, doing so may necessitate more cash: the firm plans to burn around $85 million in the fourth quarter, leaving it with only $110 million on hand at the end of the year.
In a statement, the company stated that it will “continue to explore opportunities” to raise further capital.
Subject to sufficient finance, the company aims to deliver roughly 50 units to customers in 2022 and the remainder of the first batch in the first half of 2023.
According to the release, Lordstown Motors expects to complete the third quarter with about $195 million in cash and cash equivalents, including $27.1 million in proceeds from stock issuances during the third quarter of 2022.
Lordstown Motors and Foxconn agreed to a $230 million asset purchase agreement in May to produce electric automobiles.
Foxconn as it transitions from producing consumer electronics like iPhones to producing electric cars, and Lordstown as it finally gets its much-anticipated Endurance truck off the assembly lines and, presumably, into the hands of customers.
Lordstown has struggled to reach production since going public via a special purpose acquisition (SPAC) merger in 2020 — a decision that, in retrospect, spells doom for most EV SPACs. Last summer, the company expressed concern that it might not have the cash to bring its EV to market, but was bailed out by an investment firm that pledged to buy $400 million in shares over a three-year period.
The business lost even more weight by selling its Lordstown, Ohio manufacturing to Foxconn for $230 million, which it had previously purchased from General Motors. Foxconn committed to create EVs for Lordstown, but the business will also use the Ohio plant to produce EVs for Fisker, another EV SPAC.
According to Lordstown, the production volume of the Endurance pickup will ramp up gradually, with a modest peak in November and December due to supply chain restrictions. Slowly, it appears. Two commercial release production cars have already rolled off Foxconn’s assembly line, with a third “likely to be completed shortly.”
Lordstown plans to deliver roughly 50 units to customers beginning in the fourth quarter, and the remainder of the first batch of 500 units in the first half of 2023, if it can raise more funds.