Startup of an electric car Lordstown Motors announced Tuesday that it lacks the financial resources to begin commercial production, putting the company at risk of failure and sending its shares plunging. The company modified its annual report with the Securities and Exchange Commission on Tuesday to state that it may no longer be a going concern in one year.
With $587 million in cash and cash equivalents at the end of the first quarter, the firm said it didn’t have enough money to launch the Endurance, an electric pick-up truck aimed at commercial drivers. The company said, “These conditions raise substantial doubt regarding our ability to continue as a going concern.”
Workhorse Group, led by Steve Burns, who is currently Lordstown’s chief executive, was the original bidder for the facility. Workhorse’s auditor voiced concerns in 2018 regarding the company’s ability to continue operating as a going concern. Another electric vehicle startup, Workhorse Group, licenses technology to Lordstown and owns 10% of the company.