Lordstown Motors

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Lordstown Motors
TypePublic
Nasdaq: RIDE
ISINUS54405Q1004
IndustryAutomotive
Founded2018; 4 years ago (2018)
FounderSteve Burns
HeadquartersLordstown, Ohio, US
Key people
Angela Strand ()
Daniel Ninivaggi (CEO)
RevenueSteady US$0 (Fiscal Year Ended 31 December 2020)[1]
Decrease –US$102.481 Million (Fiscal Year Ended 31 December 2020)[1]
Decrease –US$124.050 Million (Fiscal Year Ended 31 December 2020)[1]
Total assetsIncrease US$767.219 Million (Fiscal Year Ended 31 December 2020)[1]
Total equityIncrease US$630.738 Million (Fiscal Year Ended 31 December 2020)[1]
Websitelordstownmotors.com

Lordstown Motors Corporation (LMC) is an American electric vehicle automaker located in Lordstown, Ohio. The company is based out of the Lordstown Assembly plant which previously belonged to General Motors.[2]

General Motors (GM) has invested US$75 million in Lordstown Motors. GM obtained a seat on Lordstown Motors' board of directors, and has included Lordstown Motors into its Tier 1[clarification needed] supply chain. With the deal, Lordstown Motors is looking to compete against Tesla, Rivian, and Nikola's electric vehicle lineup.[3][4]

History[]

The Lordstown Plant on June 25, 2020, during a visit from then-Vice President Mike Pence.

Lordstown Motors was founded in 2018 by Steve Burns, former CEO of Workhorse Group.[5] On November 7, 2019, Lordstown Motors became the owner of the former GM Lordstown plant, after signing a sales agreement with automaker General Motors in May 2019.[6][7][8] GM loaned Lordstown Motors US$40 million in order to underwrite a substantial part of the plant purchase.[9]

In March 2020, Lordstown Motors paid Workhorse Group US$12 million dollars for the licensing rights to the intellectual property of the Workhorse W-15 pickup truck. Lordstown Motors intends on developing its own electric pickup truck based upon Workhorse's preexisting design. As part of the business deal, Workhorse Group was given a 10% equity stake in Lordstown Motors.[10][11]

In October 23, 2020, Lordstown reverse merged with a special-purpose acquisition company (SPAC) named DiamondPeak Holdings and became listed on the NASDAQ.[12] The merger gives Lordstown Motors an estimated equity value of US$1.6 billion.[13][14] On the same day, GM released Lordstown Motors from its mortgage obligations related to the purchase of the Lordstown factory.[15]

In January 2021, the company announced the opening of a vehicle service center in Irvine, California to support customers in the Southern California region.[16] It is Lordstown's first service center outside of Ohio, with California chosen due to "the favorable regulatory backdrop in the state, which is aggressively promoting more widespread adoption of electric vehicles", according to the company.[17]

In March 2021, the investment research firm Hindenburg Research that specializes in short-selling published a lengthy report about Lordstown supporting its short position in the stock. In the report, Hindenburg presented evidence that it said demonstrated a history of fraud at Lordstown, with the company misleading investors by exaggerating demand and orders for its trucks, as well as Lordstown's ability to build these trucks. Hindenburg's report showed that thousands of Lordstown's claimed orders were non-binding, no-deposit indications of interest by companies without the apparent financial strength to support the size of the orders. The report also claimed significant production delays beyond Lordstown's claimed timeline with trucks three to four years away from production, stock sales by insiders amidst vehicle testing problems, and irregularities in the background of Lordstown's founder, Steve Burns. Lordstown's stock dropped 17% on the day of the news. The company responded with a statement saying, “We will be sharing a full and thorough statement in the coming days, and when we do we will absolutely be refuting the Hindenburg Research report.”[18][19][20] The Hindenburg Research report led to the US Securities and Exchange Commission (SEC) requesting information from Lordstown Motors regarding the short-seller's claims of misleading investors.[21]

It was also revealed in March 2021 that one of Lordstown's prototypes caught on fire, with the company claiming the fire was caused by "human error" and that the issue had been solved by Lordstown now automating the manufacturing of its vehicles.[22]

On June 8, 2021 Lordstown Motors amended its annual report with the SEC and said that the company did not have enough money to begin commercial production of its vehicle, and that Lordstown Motors is at risk of bankruptcy.[23] Subsequently, both the CEO Steve Burns and CFO Julio Rodriguez resigned from their positions on June 14. While the official press release states this is in anticipation of changing from R&D to Production, the non-binding nature of the pre-sale agreements has been brought into question after revelations that the largest three purchasers were not committed to acquiring the Lordstown production vehicle (and most did not have the means to even do so if they wanted to). An independent investigation commissioned by the board found that the pre-order agreements were overstated in number and in seriousness in order to generate press.[24]

In August 2021, veteran automobile executive Daniel Ninivaggi, former CEO of Icahn Enterprises, was named as the new CEO.[25]

In October 2021, Lordstown Motors announced a $230 million deal to sell the former GM plant to Foxconn Technology Group, which would become a contract assembler for the company's Endurance pickup truck. It was announced Foxconn would also invest $50 million into the company through a purchase of common stock.[26]

Vehicles[]

Prototype Lordstown Endurance electric pickup truck

The Lordstown Endurance is an in-development all-wheel-drive (AWD), electric pickup truck. Its design includes independent wheel hub motors on all four wheels. The AWD hub motor system aims to reduce the amount of moving parts with no wheel axles or a transmission.[27] In 2019, the truck was expected to be released in the US market by late 2020, at a price of US$52,500.[28] In November 2020, the release date was delayed, pushing the first deliveries back to September 2021, with production ramping up through 2022.[29]

By October 2021, the announced production date for the Endurance had been delayed until no earlier than April 2022, following the September news that the Lordstown auto plant would be sold to Foxconn and that Foxconn would become the contract manufacturer of the Endurance.[30]

In October 2021 Foxconn unveiled three new prototype vehicles: the model 3 SUV scheduled to go on sale in 2023 in Taiwan, an electric bus that is planned to be tested in select cities in 2022, and a new electric sedan.[31]

See also[]

References[]

  1. ^ a b c d e "Lordstown Motors Corp. 2020 Annual Report Results". 31 December 2020. Retrieved 2021-06-15.
  2. ^ Sam McEachern (26 November 2019). "Lordstown Motors Endurance Electric Pickup Will Start At $52,500". gmauthority.com. Retrieved 5 December 2019.
  3. ^ O'Kane, Sean. "GM-backed electric truck startup Lordstown Motors is going public". www.theverge.com. Retrieved 17 November 2020.
  4. ^ Hall, Kalea (August 3, 2020). "Lordstown Motors to merge with acquisition company, go public". The Detroit News. Retrieved 17 November 2020.
  5. ^ Jeff Sheban (25 November 2019). "Upstart Lordstown Motors Racing To Be First With All-Electric Pickup Truck".
  6. ^ Sean O'Kane (8 November 2019). "GM sells Lordstown factory to the offshoot of a struggling EV startup".
  7. ^ Szymkowski, Sean. "General Motors Lordstown plant officially sold to electric truck startup". www.cnet.com. CBS. Retrieved 17 November 2020.
  8. ^ Welch, David. "An Electric Truck Startup Is Buying a Highly Politicized Ohio Factory From GM". www.time.com. Retrieved 17 November 2020.
  9. ^ Shepardson, Ruan (December 9, 2019). "GM loans $40 million to firm to acquire, retool shuttered Lordstown, Ohio, factory". Thomson Reuters. Retrieved 17 November 2020.
  10. ^ "Lordstown Motors Paid $12.2M for Workhorse Tech". www.businessjournaldaily.com. Youngstown Publishing Company. Retrieved 17 November 2020.
  11. ^ O'Kane, Sean. "Lordstown Motors wants to avoid the 'carnage' of failed EV startups". www.theverge.com. The Verge. Retrieved 17 November 2020.
  12. ^ Lareau, James L. "Lordstown Motors, an electric truck rival to Rivian and Tesla, gets GM investment and becomes publicly traded". www.chicagotribune.com. Chicago Tribune. Retrieved 17 November 2020.
  13. ^ Stevens, Pippa. "MARKETS Move over Nikola: A new electric truck SPAC called Lordstown is forming and the shares are surging". CNBC. CNBC. Retrieved 13 August 2020.
  14. ^ Edelstein, Stephen. "Lordstown Motors becomes publicly traded, before delivering its electric vehicles". Green Car Reports. Retrieved 30 October 2020.
  15. ^ O'Brien, Dan. "General Motors Releases Lordstown Motors Mortgage". www.businessjournaldaily.com. Youngstown Publishing Company. Retrieved 17 November 2020.
  16. ^ "Lordstown Motors sets up service center in California". WKBN-TV. 2021-01-25. Retrieved 2021-03-28.
  17. ^ Stebelton, Lauren (2021-01-25). "Lordstown Motors opens new service center in California". WFMJ-TV. Retrieved 2021-03-28.
  18. ^ Ohnsman, Alan. "Lordstown Motors Stung By Short Seller's Accusations Electric Truckmaker Misled Investors". www.forbes.com. Retrieved 13 March 2021.
  19. ^ Manskar, Noah. "Lordstown Motors stock sinks after report calls pre-orders a 'mirage'". www.nypost.com. Retrieved 13 March 2021.
  20. ^ Hall, Phil. "Hindenburg Hits Lordstown Motors, Alleging Fraud In Business Operations". www.businessinsider.com. Retrieved 13 March 2021.
  21. ^ Wayland, Michael. "Lordstown Motors shares close down 13.8% after confirming SEC inquiry". CNBC. Retrieved 8 June 2021.
  22. ^ Lambert, Fred (2021-03-18). "Lordstown hype train slows down after prototype catches on fire, orders put into question". Electrek. Retrieved 2021-03-23.
  23. ^ Bushey, Claire (8 Jun 2021). "Lordstown Motors warns its electric vehicle business may fail". Financial Times. Retrieved 8 Jun 2021.
  24. ^ O'Kane, Sean (2021-06-14). "Lordstown Motors CEO resigns after investigation into preorders". The Verge. Retrieved 30 June 2021.
  25. ^ "Shares of embattled EV start-up Lordstown Motors surge on appointment of ex-Icahn executive as CEO". CNBC. 26 August 2021. Retrieved 27 August 2021.
  26. ^ Foldy, Christina Rogers and Ben (2021-10-01). "Lordstown Motors to Sell Former GM Factory in Ohio to Foxconn". Wall Street Journal. ISSN 0099-9660. Retrieved 2021-10-01.
  27. ^ Hall, Kalea (October 26, 2020). "Lordstown Motors pushes forward with Endurance electric truck". The Detroit News. Retrieved 17 November 2020.
  28. ^ "Le Lordstown Endurance est un pick-up électrique venu d'Amérique". 4 December 2019.
  29. ^ "Lordstown Motors Releases Business Updates; Remains on Track to Begin Production of the Lordstown Endurance in September 2021". 16 November 2020.
  30. ^ "Foxconn, buyer of Lordstown plant, unveils first electric vehicle". Crain's Cleveland Business. 18 October 2021. Retrieved 29 October 2021.
  31. ^ "Company slated to buy Lordstown Motors plant unveils 3 new electric vehicle prototypes". WYTV. 2021-10-18. Retrieved 2021-11-09.

External links[]

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