Lordstown Motors stock price falls 11% after production halt, recall
The price of Lordstown Motors stock (RIDE) closed at $1.09 per share at the close of trading Thursday, falling 11.38% in value just hours after the EV producer announced that it has halted production of its all-electric Endurance pickup trucks and is recalling the trucks that have already rolled off the assembly line.
The Lordstown-based EV manufacturer announced on Thursday that the Endurance has experienced performance and quality issues with certain components that could cause a loss of propulsion while driving.
Calling the production halt temporary, LMC said in a statement to investors that they are working with suppliers on the root cause analysis of each issue and potential solutions, which in some cases may include part design modifications, retrofits, and software updates.
The company says it has filed paperwork with the National Highway Traffic Safety Administration (NHTSA) to voluntarily recall the Endurance to address an electrical connection issue.
Lordstown Motors said it is working with its supplier network to implement a corrective action that the they believe will address this issue.
The recall will affect 19 vehicles that are either in the hands of customers or being used internally by LMC.
Vehicles waiting for shipment and vehicles in process at the manufacturing plant will also be retrofitted with the corrective action once components are available.
“While our experienced team has made significant progress in addressing the underlying component and vehicle sub-system issues affecting the Endurance build schedule, we remain committed to doing the right thing by our customers and to resolve potential issues before resuming production and customer shipments,” said Edward Hightower, Lordstown Motors CEO & President.
LMC intends to provide a more detailed update on the status of these matters on its upcoming earnings call.
LMC will release its fiscal year 2022 financial results before market open on Monday, March 6, 2023.