Lordstown’s Ability to Stay Business in Doubt, CFO says

After the electric truck maker, Lordstown Motors Corp, sold the factory to raise money, the CFO said whether Lordstown Motors Corp.'s ability to do business for at least another year, remains in doubt until the company manages to secure more funding or raises its market value.  

Lordstown, which pursuing releasing its first car this year and doesn't generate any sales yet, issued a going-problem caution in June 2021, flagging issues about its financial health.

The company announced last week that it had completed a deal to sell its plant in Lordstown, Ohio to a subsidiary of the contract assembler Foxconn Technology Group. Lordstown got $230 million at its former General Motors manufacturing facility and about $27 million from Taipei-based Foxconn, which previously held about $50 worth of Lordstown shares. 

Unveiled in 2020 as a result of a merger with a dedicated acquisition company, Lordstown is undergoing a crash test on its first vehicle, Endurance, and is expected to begin commercial production in the third quarter.

Formerly known as Hon Hai Precision Industry Co., Foxconn has built the durability of Lordstown and invested $100 million in a new joint venture between the two companies. The commitment includes a $45 million loan to Lordstown.