EV struggling startup Lordstown Motors loses GM as investor – Referus


General Motors has sold its stakes to Lordstown Motors, the first electric car that has struggled to find its first car, the Endurance electric truck, to produce, reports Detroit Free Press.

7.5 million GM shares in ordinary stock, which was less than 5% of the company, had an initial value of $ 75 million. The automaker sold its share in the fourth quarter of 2021 following an undisclosed closing time.

The news comes after Lordstown revealed an extended loss of $ 81.2 million, or $ 0.42 per share, in the fourth quarter. During its lead call on Monday, the launch shared plans to produce and sell Endurance trucks reaching only 3,000 by 2023, with 500 of those expected to sell this year. That is, if the company collects more money. On Monday, Lordstown told investors it needed to raise another $ 250 million to build 500 trucks.

The additional funding request already does not look good, but in addition the revised direction is far below the 32,000 units the previous management promised investors to lead in Lordstown public listing under the SPAC agreement in October 2020.

Lordstown’s relationship with GM goes back to 2018 when GM said it would close its Lordstown factory, which former President Donald Trump opposed. GM then sold the plant to another hard-working EV company, Workhorse (which, by the way, still struggled with its Q4 profit showing a quarterly loss of $ 1.13 per share).

Workhorse founder and former CEO, Steve Burns, started Lordstown Motors with plans to build electric trucks at the old GM factory, and GM invested $ 75 million in the company. Lordstown has invested an estimated $ 240 million in the industry, but has not been able to pull it off.

Following a series of dramas, including the loss of significant leadership during production crises, Lordstown revealed it did not have enough money to reach 2023, so it sold the industry in September to iPhone producer Foxconn for $ 230 million. However, the deal has not yet been finalized, and the Lordstown leadership said on Monday that the factory deal was not as far as expected, another announcement that undoubtedly led investors to take their seats.