The embattled EV startup claims Foxconn ‘had no intention of living up to its commitments.’
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The electric vehicle startup Lordstown Motors is filing for bankruptcy and suing Foxconn, one of Apple’s top iPhone manufacturers, after a deal between the two companies fell through. In a press release posted on Monday, Lordstown Motors claims Foxconn’s “fraud and willful and consistent failure to live up to its commercial and financial commitments” led to “material damage” to the EV company.
Lordstown blames Foxconn for the bankruptcy filing, alleging that the Apple supplier “had no intention of living up to its commitments.” It also claims Foxconn used its agreements with the company “to maliciously and in bad faith destroy Lordstown’s business — while leveraging resources gained through the partnership to advance its own business interests.”
Foxconn disputes these claims in a statement, saying:
LMC [Lordstown Motors Corporation] has continuously attempted to mislead the public and has been reluctant to perform the investment agreement between the two parties in accordance with its terms. Foxconn originally hoped to continue discussions and reach a solution that could satisfy all stakeholders, without resorting to baseless legal actions, but so far the two parties have yet to reach a consensus.
Lordstown says it will go through a restructuring process that involves an auction of its assets, including the rights to its Endurance EV platform. Lordstown began shipping the first batch of 500 Endurance EV pickups last November.
Lordstown Motors took over General Motors’ closing Ohio factory in 2019, where it said it would build electric pickup trucks, including a prototype called the Endurance. Although Lordstown received $75 million in funding from GM, things haven’t been going so well for the company in recent years.
“Despite our best efforts and earnest commitment to the partnership, Foxconn willfully and repeatedly failed to execute on the agreed-upon strategy, leaving us with Chapter 11 as the only viable option to maximize the value of Lordstown’s assets for the benefit of our stakeholders,” Edward Hightower, the CEO and president of Lordstown, says in the press release. “We will vigorously pursue our litigation claims against Foxconn accordingly.”
