Lordstown Motors (RIDE) – Get Report dropped on Friday after short-selling funding agency Hindenburg put out a sharply essential report on the electric-vehicle maker and mentioned it took a brief place within the inventory.
Shares of the Lordstown, Ohio, firm not too long ago traded at $14.19, down 20%.
Lordstown didn’t instantly reply to TheStreet.com’s request for remark.
The Hindenburg report says “Lordstown is an electrical car SPAC with no income and no sellable product, which we consider has misled buyers on each its demand and manufacturing capabilities,” it mentioned.
“The corporate has persistently pointed to its ebook of 100,000 pre-orders as proof of deep demand for its proposed EV truck.
“Our conversations with former staff, enterprise companions and an intensive doc evaluate present that the corporate’s orders are largely fictitious and used as a prop to lift capital and confer legitimacy.”
For instance, the report says “Lordstown not too long ago introduced a 14,000-truck deal from E Squared Power, supposedly representing $735 million in gross sales. E Squared relies out of a small residential residence in Texas that doesn’t function a car fleet.”
One other assertion within the report: “One senior worker advised us that whereas working with [the CEO] for a few years, they noticed extra questionable and unethical enterprise practices than they’d seen of their total profession.”
As well as, “former staff additionally shared that the corporate has accomplished none of its wanted testing or validation,” the report mentioned.
Hindenburg final 12 months pushed down the inventory of one other electric-vehicle company, Nikola NKLA, with a damning report.