Autos

Lordstown Motors shares sink on underwhelming production plans, uncertainty around Foxconn deal

Key Points
  • Lordstown Motors expects to produce and sell up to only 3,000 vehicles through next year, the company announced Monday.
  • The plans include 500 vehicles this year, with retail production slated to begin in the third quarter.
  • Those numbers are far below the amount former management sold investors on when the company went public in 2020.

In this article

Lordstown Motors gave rides in prototypes of its upcoming electric Endurance pickup truck on June 21, 2021 as part of its "Lordstown Week" event.
Michael Wayland / CNBC

Embattled electric vehicle start-up Lordstown Motors expects to produce and sell up to only 3,000 vehicles through next year, the company announced Monday.

The plans include 500 vehicles this year, with production slated to begin in the third quarter — a year later than expectations cited by Lordstown when it went public through a special purpose acquisition company in October 2020.

The total sales and production figures also are far below the amount former management sold investors on in the runup to the public listing. Lordstown initially expected to build 2,000 Endurance pickups in its first year, followed by 32,000 units during the first full year of production.

Shares of the pre-revenue company plunged as much as 28% during Monday afternoon trading. The stock closed Monday at $2.57 a share, down by 20%.

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Lordstown Motors announced the production forecast as part of reporting its fourth-quarter results. Net loss widened to $81.2 million, and the automaker incurred a total of $115 million in expenses.

Company executives said they need to raise about $250 million this year for its business operations, including tooling to produce the vehicle.

Lordstown CEO Dan Ninivaggi said the company will initially only sell vehicles to a modest number of pre-selected businesses. It said it still needs some regulatory certifications before it can put vehicles on sale.

The aspiring automaker initially planned to produce the Endurance pickup internally at an Ohio plant it purchased from General Motors.

But following an executive shake-up and amid ongoing concerns that the company could run out of cash, Lordstown announced a deal to sell the plant to iPhone maker Foxconn for $230 million in November. That deal, which includes Foxconn producing the Endurance pickup, has not been finalized.

Lordstown and Foxconn also are in negotiations about a potential joint development of future vehicles. The company characterized those talks Monday as "an important component" for Lordstowns' future success.

"We need to bring that to a conclusion, and I'm hopeful we'll get there," Ninivaggi said Monday.