The CEO and CFO of Lordstown Motors resigned on Thursday amid chaos for the electric vehicle brand. Shares of the company plummeted after it announced that it would be closing its doors in December due to a lack of demand for its vehicles.
Steve Burns, the CEO and CFO of Lordstown Motors, resigned amid chaos for the electric vehicle brand. Read more in detail here: steve burns lordstown motors.
Lordstown Motors stated last week that it may not be able to remain viable for the next year. With the news that several important people are departing the business, it seems like the ship is continuing to sink. Is the electric car company doomed before it even makes its first vehicle?
Why is the stock of Lordstown Motors declining?
The Endurance electric pickup truck from Lordstown Motors | Matthew Hatcher/Bloomberg via Getty Images
Steve Burns, the founder and CEO of Lordstown Motors, and Julio Rodriguez, the Chief Financial Officer, both resigned on Monday morning. The firm recently conducted an internal inquiry with Hindenburg Research LLC, according to Reuters. Hindenburg is a company that specializes in short-selling businesses.
Lordstown inflated pre-orders for the electric vehicle trucks under development, according to the inquiry. Lordstown, on the other hand, dismissed the notion that the business deceived investors about future production plans.
Angela Strand has been appointed the company’s newest executive chairperson. She was already the company’s senior independent director, but she will take over as CEO until a more permanent replacement is found. Interim finance chief Becky Roof has been appointed.
Lordstown Motors is still struggling.
Following the news last week, Lordstown Motors’ stock (RIDE.O) went into rapid decline. The price stock was approaching an all-time high of nearly $30 in February. The stock was hovering around $11 at the end of last week, but it has since dropped below $10 at the time of this news.
Lordstown attempted to assuage fears that the business was failing by stating that it was in discussions with other sources to obtain money. According to Reuters, Hindenburg announced in March that it had taken a short position in Lordstown shares, claiming the business had deceived customers and investors. While Lordstown claimed to have received enough orders to meet internal requirements, Hindenburg discovered a large number of “fictitious” orders.
In addition to all of this, the Securities and Exchange Commission (SEC) of the United States has launched a fresh inquiry. The Securities and Exchange Commission (SEC) has asked for additional information regarding the SPAC transaction and the presale misinformation.
The business continues to take blows.
Lordstown Motors has $587 million in cash on hand, according to Investors Business Daily. Unfortunately, the company also claims that this is insufficient to begin commercial manufacturing of the Endurance electric vehicle. According to Lordstown’s papers, “these circumstances create significant doubt about our ability to continue as a going concern for at least one year.”
While $587 million will keep trucking going for the time being, it will not be enough to start production of the brand’s only car. The firm says it is debt-free and is in discussions with other businesses to obtain funds.
Burns was also the CEO of Workhorse Group, which makes a different kind of electric vehicle. He seems to be retooling his own intentions to return to his old employer. While this is not uncommon, it does not speak well for Lordstown Motors’ future. Investors will be able to visit the facilities and meet with management at an event scheduled for the end of June.
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The lordstown new ceo is a story about the CEO and CFO of Lordstown Motors stepping down amid chaos for the electric vehicle brand.
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