Foxconn sells Ohio EV assets in shift to AI, data centers: Source

Taipei, Aug. 5 (CNA) The disposal of electric vehicle assets in Ohio by Taiwan-based manufacturing giant Hon Hai Precision Industry Co. (Foxconn) is aimed at boosting its artificial intelligence and data center development, according to an industrial source.

Speaking with CNA, the source said Monday that the move reflects the shift in focus to AI development after the company announced last week a strategic partnership with Taiwan's Teco Electric & Machinery Co. through a stock swap to expand AI infrastructure capabilities.

The partnership with Teco and the disposal of the EV assets in Ohio are expected to boost the chances of Hon Hai, known globally as Foxconn, to join the US$500 billion AI infrastructure Stargate Project initiative, the source said.

Hon Hai will use the gains from the disposal of assets to invest in the U.S. market, the source said.

The assets involved in the disposal deal were land, buildings and equipment in Ohio, and they were sold to Crescent Dune LLC for about US$375 million, according to an announcement released by Hon Hai on Monday on behalf of its subsidiary Foxconn EV Asset Management LLC.

The EV assets were purchased by Hon Hai from American electric pick-up maker Lordstown Motors in November 2021. The disposal, which resulted in US$169 million in profit, was aimed at optimizing its assets and improve its product portfolio, the company said.

Despite the disposal of the EV assets, the source said Hon Hai's plan to launch sport utility vehicle Model C in the U.S. market will stay unchanged.

At an investor conference held in early July, Hon Hai said the U.S. version of Model C is currently in the process of certification and its development will be finished by the end of 2025.