EV startup Lordstown Motors is still in trouble after pausing production earlier this year. The Endurance electronic pickup truck maker said today that it expects to stop producing the vehicle “in the near future” if it can’t find a partner to keep it afloat. The warning follows a separate filing from earlier this week saying it could file for bankruptcy if its deal with Foxconn can’t be resurrected.
“Due to the production delays from early January to mid-April 2023, the failure to identify a strategic partner for the Endurance, and extremely limited ability to raise capital in the current market environment, we anticipate production of the Endurance will cease in the near future,” the company wrote in today’s filing. “To date, we have not identified a strategic partner for the Endurance.”
According to the SEC filing, Foxconn sent a letter to Lordstown on April 21st, threatening to terminate the two companies’ investment deal, which saw the Taiwanese manufacturer investing up to $170 million in the startup. (That followed a previous deal where Foxconn bought its Ohio factory.) In the letter, Foxconn told Lordstown it breached the agreement because the startup’s stock price fell below $1 per share for 30 straight trading days, leading to a NASDAQ delisting notice. Lordstown said it believes Foxconn’s claims are without merit and considers their investment agreement to remain in effect while talks continue. However, it concedes that bankruptcy is on the table if it can’t resolve the dispute “in a timely manner on terms that allow us to continue operating as planned” or find other strategic partners.
Lordstown reported a net loss of $171.1 million in the first quarter of this year, following a loss of $89.6 million in the same quarter a year ago. The EV maker had just $108.1 million in cash (and cash equivalents) on March 31st. Its stock price is currently hovering at 39 cents after peaking at $31.57 in early 2021.
It’s been a short but bumpy ride for Lordstown, which was only founded in 2018. Two years ago, its CEO resigned after an investigation revealed that executives lied about demand, the viability of Endurance’s technology and its ability to start production on schedule by September 2021. The same year, it became the subject of DOJ and SEC investigations. GM sold its stake in the company last March, although Lordstown did finally begin delivering the first trucks from its initial 500-unit order in November. However, it then froze production in February to address “performance and quality issues” and partnered with the National Highway Traffic Safety Administration (NHTSA) on a voluntary recall to remedy a connection problem that could cut off motor output while driving.