Foxconn Learns Making Vehicles is Hard

The company’s background doesn’t quite do enough to make the leap into EV manufacturing.

In late 2021, as it teetered on the brink of collapse, EV maker Lordstown Motors was handed a lifeline.

As the maker of the Endurance electric pickup was fending off lawsuits, investigations, and cash shortages, it’s future was in doubt until Foxconn Technology Group swooped in with an offer: it would pay $230 million for Lordstown’s Ohio factory, buy a $50 million stake in the company and become a contract assembler for the Endurance.

Foxconn, whose core competency has long been consumer electronics, was entering a new fray but had vast ambitions: at the time, the company predicted it would generate $33 billion in annual revenue in its auto business by 2025.

But a recent report from Bloomberg suggests that this goal might be a bit lofty. While Foxconn has boosted its auto segment via partnerships in Thailand, Taiwan and Saudi Arabia, it doesn’t have much to show for it thus far. Bloomberg is reporting that, to date, “the only vehicles Foxconn has made are a handful of prototypes, a few dozen electric buses and about 40 pickups for Lordstown.”

Foxconn’s expertise, of course, lies in the electronic components side of the EV business, and with battery packs, which it recently announced it would produce in the famed Mount Pleasant, Wisconsin plant – the site of an over-promised and under-delivered manufacturing compound that was once touted as producing 13,000 jobs but has, after 5+ years, only produced 1,000.

So far the Lordstown Motors deal is also off to a sluggish start. Earlier this year, Lordstown asked Foxconn to suspend production of the Endurance because the cost to produce it has exceeded $65,000 per vehicle – which was more than the truck’s targeted sale price. Later, Lordstown said that the Endurance might not make it without the help of an experienced automaker to help scale the project.

According to Bloomberg, “Foxconn says that it remains committed to its EV plans and that its experience in electronics sets the stage for success in cars.” That said, it’s becoming more and more concerning that the company’s background in electronics doesn’t quite do enough to make the leap into electric vehicle manufacturing.

And then there’s Foxconn’s sordid past…

Michael Shields, a researcher at Policy Matters Ohio, a nonprofit that evaluates the economic impact of big industrial investments in the state, told Bloomberg that the lack of success of the Wisconsin project is a big red flag, and says he believes “there is cause for concern … about what is going to happen in Lordstown.”

More in Video