Lordstown Motors Company has filed for chapter safety and is suing contract manufacturing associate Foxconn, the corporate introduced Tuesday.

Lordstown filed for Chapter 11 safety in a Delaware chapter court docket. The corporate additionally filed a authorized grievance towards Foxconn, the manufacturing arm of Taiwan’s Hon Hai Expertise Group greatest recognized for making the Apple iPhone, accusing the corporate of fraud and failing to satisfy monetary commitments.

The automaker was shaped to take over the former Normal Motors manufacturing unit in its namesake Ohio city and use the plant to fabricate an electrical pickup truck referred to as the Endurance. Lordstown offered the plant to Foxconn in 2021 for a purported $230 million as a part of a deal that referred to as for Foxconn to fabricate the Endurance underneath contract, in addition to spend money on Lordstown, and for the 2 corporations to co-develop future automobiles.

2023 Lordstown Endurance

Lordstown now alleges that Foxconn “had no intentions of residing as much as its commitments, significantly with respect to the brand new car growth platform.” The corporate claimed Foxconn used its partnership with Lordstown” as a software to maliciously and in unhealthy religion destroy Lordstown’s enterprise.”

Endurance manufacturing started final fall, however Lordstown disclosed that solely 31 vans had been constructed, and 19 recalled, earlier than manufacturing was halted in February. The corporate mentioned in April that manufacturing had resumed.

Within the interim, Lordstown mentioned it was shifting focus to its subsequent EV, which might be primarily based on a Foxconn platform. However Lordstown in Could warned of chapter if Foxconn adopted via with a menace to drag funding for the automaker.

2023 Lordstown Endurance

In a deal made final November, Foxconn agreed to take a position as much as $170 million in Lordstown in return for shares within the firm. Foxconn beforehand invested $52.7 million in Lordstown as a part of the settlement, giving it an 8.4% stake, Reuters famous. An extra $42.7 million due in Could was not paid. Lordstown has been accusing Foxconn of balking at additional funding in keeping with the deal, whereas Foxconn has accused Lordstown of breaching the phrases of the deal when the automaker’s inventory fell beneath the $1 per share threshold (for 30 days) required for itemizing within the Nasdaq.

Foxconn is pivoting to creating its personal EVs, albeit probably for different markets, and has different deliberate makes use of for the Ohio manufacturing unit. It has contract-manufacturing agreements with different automotive startups, together with IndiEV and Fisker.