Lordstown Motors shares drop almost 19%

Lordstown Motors Corp (Nasdaq: RIDE) is officially at risk of bankruptcy, and the electric vehicle maker's shares fell 17% after the opening bell. The company stated in the filing they recently submitted to the United States Securities and Exchange Commission. The company now believes it won't be in business long. The company's CFO Julio Rodriguez and CEO Steve Burns resigned on Monday. At this point, an internal investigation into investor misleading is ongoing. The company had faked orders to raise capital for its Endurance electric pickup. Lordstown stated that it would need to complete the development and manufacture of its electric cars, obtain regulatory approval, produce the vehicles on a commercial scale, and officially bring them to market in order to continue doing business. The company didn't say much more than that in the filing. They made it clear that they are still striving to start production of the cars by the end of September this year. The company also said it had $ 259.7 million in cash as of March 31, after posting a net loss of $ 125.2 million for the past three months. Lordstown Motors was listed on the stock exchange last year after it merged with a SPAC. It is now looking for further funding. That news caused the company's share price to drop 8%. However, this is not a whole new thing for the company. Steve Burns, the company's CEO, had asked for additional capital a while ago. The media in the United States has suggested that if the company fails to get additional funding, it could end up manufacturing only about 1,000 cars, or even fewer. That's not nearly the number they forecast when they launched the Endurance, which they claimed will produce 20,000 in 2021. This report added fuel to what Hindenburg previously claimed. Hindenburg took aim at Lordstown this spring, saying they doubted the company had 100,000 pre-orders. It further stated that they found this crowd "largely fictional". The endurance car prototype is also said to have burned out when it was first tested on the road in January this year. This was something the SEC was investigating. The Endurance was unveiled in the summer of 2020 in the presence of Mike Pence, a former Vice President of the United States. The electric pickup is powered by 4-wheel hub motors, which should generate a total of 448KW. It has been reported that LG Energy has been entrusted with the delivery of the battery cells. In the meantime, the company is still grappling with the fact that many of its competitors have their own electric pickups. For example, Ford has finally introduced its own version of an electric pickup with the new F-150.