Life isn’t getting any easier for Lordstown Motors. Last week, the startup issued a “going concern” warning, telling investors that it might not be able to start production of its electric work truck without a fresh infusion of cash. We saw the consequences on Monday morning, as the company announced that CEO Steve Burns and CFO Julio Rodriguez have resigned. Angela Strand has been appointed as executive chairwoman and will helm Lordstown until a new CEO is appointed, with Becky Roof serving as Interim CFO.
Lordstown Motors emerged from another beleaguered startup called Workhorse, which planned to produce a plug-in hybrid work truck made from carbon fiber. But in 2018, the stock market was much less willing to hand out gigantic blank checks to electric vehicle startups, and that hybrid truck was shelved. Workhorse’s then-CEO Steve Burns departed the company.
On his way out, Burns licensed some of Workhorse’s technology (involving hub-mounted motors for each wheel), forming the basis for Lordstown Motors. Lordstown would make a battery EV pickup instead of a plug-in hybrid truck, and it would do so in a former General Motors factory in Lordstown, Ohio (giving the new startup its name).
Burns also brought Workhorse’s order book with him, we were told—a book bulging with 50,000 pre-orders. But in March, a short-selling organization called Hindenburg Research published a report claiming that Lordstown’s pre-orders were exaggerated. Lordstown denied overstating its orders, but by this point, it had attracted the attention of the US Securities and Exchange Commission. This in turn triggered the revised annual report with the going-concern warning—and the resignations of Burns and Rodriguez.
“We remain committed to delivering on our production and commercialization objectives, holding ourselves to the highest standards of operation and performance and creating value for shareholders,” Strand said in a statement. “Along with the management team, I will continue to work closely with them and the Board to execute on Lordstown’s vision for the future of electrified transportation. I am excited to lead the passionate and dedicated team of Lordstown employees and to work with our valued customers, suppliers, investors, and partners and to hosting Lordstown Week, which commences on June 21st.”