Lordstown Motors loses $125M, cuts production estimate in half

LORDSTOWN, Ohio - Reporting a net loss of $125 million in the first quarter of 2021, Lordstown Motors announced that the production of its electric-powered pickup truck would be no more than 50% of what had been planned.
Still eying a late September start of production, LMC said in its earnings report released on Monday that production will be limited.
LMC said due to higher than anticipated spending on the beta program, validation tests, buying parts, and costs of third-party engineering, the company has started discussions to raid additional capital needed to execute its plans.
The startup anticipates capital expenditures of between $250 and $275 million, operating expenses of between $55 and $60 million in selling and administrative costs, and between $280 and $290 million in research and development costs.
The company says it is pursuing an Advanced Technology Vehicle Manufacturing loan, tax credits, and grants.
Executives say they have completed the construction of 48 out of 57 prototypes and will begin pre-production vehicle builds in July.
“We recently passed two of the most difficult crash tests and, as such, believe we remain on track to deliver a 5-star rated vehicle,” said Lordstown Motors’ Chairman and CEO Steve Burns.
Lordstown Motors has been battling negative publicity since earlier this year when word leaked out that an Endurance prototype burst into flame during a test drive in January as well as a report from Hindenberg Research questioning the veracity of LMC’s claims that it had 100,000 pre-orders for the Endurance.
Since then, investors have filed class-action suits against Lordstown Motors alleging violation of Security and Exchange Commission rules. One lawsuit claims that four LMC executives engaged in insider trading.
Lordstown Motors CEO Steve Burns revealed that an SEC investigation is underway as well.
In addition to promising cooperation with the SEC probe, Burns has vowed to challenge the lawsuits.