Lordstown Motors, an Ohio-based electric vehicle (EV) manufacturer, has raised concerns about the future production of its electric endurance pickup. The company has indicated that unless it secures a strategic partner and further investment, the production of the Endurance may come to a halt.
Initially, Lordstown Motors had planned to produce only a limited number of units of the Endurance pickup. However, production was halted for several months due to issues with parts and performance. The company, which had previously partnered with electronics giant Foxconn, is currently embroiled in a dispute with the Taiwanese company. This dispute was triggered by Lordstown’s stock decline and the company’s potential consideration of bankruptcy protection.
The Endurance pickup, which commenced production at the former General Motors factory in Lordstown, Ohio in 2022 with assistance from Foxconn, faced challenges even after manufacturing a few hundred units. Lordstown Motors has experienced delays and controversies in the past, and Foxconn’s involvement was seen as a crucial bailout for its production plans. However, the partnership has now encountered difficulties as Foxconn has its own aspirations for EV manufacturing in the United States.
The recent crisis was prompted by Lordstown’s stock price falling below $1 per share, leading Foxconn to claim a breach of contract in April. In addition, Lordstown received a delisting notice from Nasdaq, putting the $170 million investment agreement with Foxconn in jeopardy. Lordstown Motors’ stock price dropped below $1 in March 2023 and currently trades at $0.37.
Foxconn stated that it would terminate the deal if Lordstown did not correct its course within a month, which could potentially involve a reverse stock split to boost the stock price and prevent delisting.
However, the focus on the stock price issue has overshadowed a more significant concern: the lack of additional capital required to sustain Endurance production. Lordstown acknowledged that substantial additional funding is necessary to execute its business plan successfully. The company is actively seeking strategic partners, including other automakers, to provide the needed capital and support for scaling the Endurance program and developing new vehicle programs in collaboration with Foxconn or other partners, as stated in a filing.
Lordstown Motors appears to have only had enough capital to produce a few hundred units of the Endurance, primarily sold to fleets rather than private buyers. The company had already communicated earlier that further production of the Endurance depended entirely on securing additional capital. Without this funding, Lordstown Motors had planned to produce and deliver only around 500 pickup trucks in 2022 and 2023.
While Lordstown has focused its efforts on direct sales to fleets, its low production levels and the inability to achieve steady serial production have hindered its chances of securing large fleet orders. The competitive landscape has also intensified, with the Ford F-150 Lightning presenting strong competition in the fleet business.
Lordstown added, “To date, we have not identified a strategic partner for the Endurance. To the extent we do not identify such a partner, we anticipate that production of the Endurance will cease in the near future.”
As Lordstown Motors faces uncertain prospects, the company’s ability to find a strategic partner and secure additional investment will determine the fate of the Endurance pickup and the future of the company itself.
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