The daily business briefing: June 28, 2023

1. EV startup Lordstown Motors files for bankruptcy protection

Struggling electric-vehicle startup Lordstown Motors filed for bankruptcy protection on Tuesday after a dispute with its investment partner, Taiwan-based contract manufacturer Foxconn. Lordstown bought a closed General Motors factory in Ohio, and was praised by then-President Donald Trump for saving jobs. Foxconn, founded in 2018, built a small number of its Endurance pickup trucks starting in September 2022 but paused in February to fix quality issues. Foxconn said it breached an investment agreement when its stock fell below $1 a share, and Lordstown filed a lawsuit accusing Foxconn of shirking a commitment to invest more in the company. Lordstown is the latest EV startup to hit obstacles. Amazon-backed Rivian has produced far fewer vehicles than expected.

The New York Times Car and Driver

2. Nvidia, AMD shares fall as U.S. mulls new restrictions on China AI chip sales

Shares of Nvidia and Advanced Micro Devices slipped in after-hours trading Tuesday after The Wall Street Journal reported that the Biden administration is considering new restrictions on sales of advanced artificial-intelligence microchips to China. Nvidia shares fell by about 3% overnight after gaining 3.1% in regular trading on Tuesday. AMD fell 3% after closing up 2.7%. The Journal reported that the Commerce Department might require U.S. companies to get a special license before selling Chinese firms AI chips. China is a key semiconductor market, and the new rules could create headwinds for stocks that have shot higher this year in an AI-fueled investment boom.

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MarketWatch The Wall Street Journal

3. Ford to lay off 1,000 U.S. employees

Ford Motor plans to lay off 1,000 or more salaried and contract workers in North America, The Wall Street Journal reported Tuesday, citing people familiar with the matter. The auto maker started notifying some salaried employees of the coming cuts on Monday, a company spokesperson confirmed. The layoffs are expected to focus on engineers. Ford has been cutting costs to offset heavy investments in electric cars. The company went through several rounds of layoffs last year. It cut 3,000 U.S. jobs — out of a North America staff of about 28,000 salaried employees — last summer and a slightly larger number in Europe early this year.

The Wall Street Journal

4. Stock futures stall after Tuesday rally

U.S. stock futures struggled for footing early Wednesday after Tuesday's broad rally. Futures tied to the Dow Jones Industrial Average were up 0.1% at 6:30 a.m. ET, but S&P 500 and Nasdaq futures were down 0.2% and 0.5%, respectively. Chip shares were down on news the U.S. is considering more restrictions on sales to China. The Dow and the S&P 500 gained 0.6% and 1.2%, respectively, on Tuesday. The Nasdaq surged by 1.7%, putting the tech-heavy index on track for its best first half in 40 years with a boost from tech giants and optimism about AI technology. The Nasdaq has gained 29% so far this year. The S&P 500 is up 14%.

CNBC

5. Google withdraws drag show sponsorship after Christian employees complain

Google distanced itself from a company-promoted Pride Month drag performance after several hundred employees signed a petition calling it anti-Christian and accusing the company of religious discrimination. Google, a corporate sponsor of Pride events in San Francisco each year, removed the "Pride and Drag Show" featuring popular performer "Peaches Christ" from an internal events page and promoted an in-office social gathering instead. The company didn't say whether the petition was the reason for the change, telling USA Today the drag event was planned outside its standard process requiring events to be approved in advance. The petition said the "provocative and inflammatory artistry" was "a direct affront to the religion beliefs and sensitivities of Christians."

USA Today