Lordstown Motors, a developer of light-duty, battery-electric pickup trucks for commercial fleets, has faced a dispute with its production partner, Foxconn Technology Group, which could result in Foxconn terminating its investment, potentially forcing Lordstown into insolvency. 

Six months ago, Foxconn agreed to invest USD 170 million in Lordstown, and two board positions were offered to Foxconn. The company also made a payment of USD 230 million for a factory in Lordstown, Ohio, which was slated to make Lordstown’s debut vehicle. However, in January, Foxconn was requested to suspend production because the cost of manufacturing Lordstown’s Endurance battery-powered truck exceeded the targeted sale price of USD 65,000. 

Lordstown is currently attempting to resolve the dispute while exploring alternative options such as identifying other sources of funding, identifying a strategic partner, and resolving its significant contingent liabilities. Failing this, the company may need to curtail or cease operations and file for bankruptcy. 

The announcement resulted in the shares of Lordstown dropping 29% to 37 cents a share.