LORDSTOWN, Ohio — Lordstown Motors -- the company that moved into the shuttered GM plant in Trumbull County to create its electric Endurance vehicle -- announced it has filed for Chapter 11 bankruptcy along with litigation against Foxconn, citing “fraud and willful and consistent failure to live up to its commercial and financial commitments to the company.”
Lordstown Motors also announced "a comprehensive marketing and sale process for the Endurance vehicle and related assets,” adding the company “is confident that a buyer could utilize the Endurance platform to create multiple EV variants and take the product to the next level.”
"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," according to a statement from Edward Hightower, the CEO and President of Lordstown Motors. "We will vigorously pursue our litigation claims against Foxconn accordingly."
Lordstown Motors says the company is entering Chapter 11 bankruptcy “with significant cash on hand and is debt-free.”
"We remain confident that an orderly, expedited sale process will maximize value for our stakeholders and enable the talent and technology behind the Endurance to find new and supportive ownership," Hightower said. "While in Chapter 11, Lordstown will continue to support our customers. We are grateful for the Lordstown team for their commitment and dedication to our vision and to our customers, suppliers and business partners for believing in the Endurance and in the EV evolution."
Lordstown Motors says the lawsuit “details the fact that Foxconn had no intention of living up to its commitments, particularly with respect to the new vehicle development platform.”
“As the lawsuit describes, Foxconn simply used its variety of contractual arrangements with the company as a tool to maliciously and in bad faith destroy Lordstown's business -- while leveraging resources gained through the partnership to advance its own business interests.”
Under the partnership, Lordstown said they had agreed to divest its most valuable assets to Foxconn -- namely the manufacturing facility in Lordstown -- along with manufacturing and operational employees.
“The up-front purchase price for the Lordstown manufacturing facility reflected the expected benefits of the contractual assurances from Foxconn that Foxconn would support the Endurance pickup truck in a variety of ways and follow through on a joint vehicle development program, leveraging what was purported to be Foxconn's established and extensive EV ecosystem and meeting its commitments to the Lordstown community,” Lordstown Motors said. “The lawsuit details the fact that Foxconn had no intention of living up to its commitments, particularly with respect to the new vehicle development platform.”
